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Partial and Residual Payments in S/4HANA Cloud
I have been asked about partial payments in S/4HANA Cloud lately. So lets take the opportunity to explore not only this process but also residual payments.
First lets first understand the difference.
A partial payment happens when we post a payment on account and no clearing occurs. This means both invoice and payment will remain as open items till we cleared them.
On the other hand, a residual payment will clear the original document and a new item will be created.
Partial Payment Process
Lets take as example that we issue a customer invoice with the amount of 100.
We later receive the amount of 60 and we know this is related to the open item with value 100.
In the Fiori app Post Incoming Payment you select the item to be cleared and in the column “Allocated amount” you put the amount 60
In the report Manage Customer Line Items you can see that both items are open and linked through the field “Invoice Reference
Keeping with the same example, later on we receive a second payment of 40. So we repeat the steps described above.
And checking the open items of this customer we see 3 open items related to the same invoice.
It’s now time for the clearing. For this purpose use the Fiori Clear Incoming Payments.
Because the payments are linked to the original invoice is possible to have the system selecting automatically the open items related to the same invoice. This way you can clear the items directly in the app Post Incoming Payment.
For this go to the Fiori Edit Options for Journal Entries and select the field “Use Invoice Reference”
This way, you can skip the step “Clear Incoming Payments”
Residual Payments Process (residual clearing)
Lets take the same example of the 100 customer invoice we issue.
We receive a payment of 95 and decide to give the customer a discount of 5 and clear the invoice.
In the Fiori Post Incoming Payment we need to change the layout of Items to be cleared and make sure the columns Residual Amount and Reason Code
Configuration for Residual Clearing
To configure the reason codes you can use SSCUI 500017 – task ID 100069 Payment Difference Reason