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Currently, Xero does not allow for payments to be allocated to specific orders or items within a single invoice, especially when partial payments are made. This can make it challenging to track how much has been paid for each order/item when clients pay separately.

We request a feature that allows businesses to reconcile payments at the order/item level within an invoice, with automatic tracking of how much has been paid for each item until the full invoice is settled. This would streamline workflows, reduce manual tracking, and minimize errors when dealing with multiple orders/items on a single invoice.

One of our regular clients is overseas and has to pay withholding tax on some line items (e.g. conference talk honorarium) but not others (e.g. train fares). We do not know the withholding tax amounts in advance, so we invoice them for the full amount. They will send us a part-payment which should fully pay the non-taxable items and the remainder of the payment should be credited to the taxable items. It's not possible to determine which line items the payment should be credited to at the moment, meaning I need to create a workaround. It would be better if it could all be done easily.

Here's another scenario that would benefit from being able to apply a part payment to specific invoice lines:

A two-line invoice includes a hire fee (income) amount and a refundable security/booking deposit amount (liability).

The deposit amount only is paid a few months early to secure a booking.

Xero apportions a part payment across all invoice lines which requires some manual journal jiggery-pokery at period end to put the full amount of the deposit into the liability account.

Ability to reconcile invoices & bills where they are part-paid that’s written within the line items.

Purpose: To make users easier to reconcile part payment that was made by the customers/suppliers.