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111 votes
Thank you everyone for engaging about the need for a discount column in Bills with us here.
While there isn’t a direct column for adding a discount atm, there are a few ways you could look to reflect this in your bills right now;
- Use Xero’s inbuilt calculator in the Price field, and add a note to the description of that line e.g $5 item at a 20% discount you would enter 5 x 0.8 in the quantity field and could add a description “including 20% discount”
- Reduce the Quantity field to reflect the discount e.g 20% discount enter 0.8 in the Quantity and use a descriptor as above
- Use a separate line of the bill to enter a whole amount discount with a negative Price amount
- If you use Purchase orders, when you copy the Purchase order to a Bill though the discount column will not show the Subtotal…
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Shuaib Moolla
supported this idea
·
Dear Xero Product Team,
I would like to submit a feature request that I believe would provide significant value to businesses using Xero Accounts Payable, particularly wholesalers, retailers and companies that regularly receive supplier settlement discounts for early payment.
Currently, when paying supplier bills through Batch Payments, there is no built-in functionality to process settlement discounts. Users are required to manually reduce the payment amount and then create separate supplier credit notes to clear the outstanding balance. This process is time-consuming, creates additional administrative work, and can lead to inconsistencies in VAT treatment and reporting.
Recently, while processing supplier payments in our business, we had to manually reduce payment amounts, create separate supplier credit notes, allocate those credit notes against the invoices, and create a dedicated reporting account simply to track settlement discounts received. While this works, it is unnecessarily cumbersome for what is a common accounts payable function.
I would like to suggest the following enhancements:
1. Settlement Discount Column in Batch Payments
Add a "Settlement Discount" column directly within the Batch Payment screen.
This would allow users to:
- Enter either a discount percentage or discount value against each invoice.
- Automatically calculate the final payment amount.
- Automatically clear the invoice balance.
- Automatically post the discount to a designated settlement discount account.
2. Supplier Discount Terms
Add discount terms to the supplier/contact setup screen, allowing businesses to capture information such as:
- 2.5% discount if paid within 30 days.
- 1.5% discount if paid within 14 days.
- Custom settlement discount structures.
When selecting invoices for payment, Xero could automatically calculate and suggest the applicable discount.
3. Discount Visibility in Bills to Pay
Add additional columns and sorting options within the Bills to Pay screen, including:
- Discount Date.
- Discount Available.
- Settlement Discount %.
- Estimated Saving.
Users should be able to sort and filter by Discount Date in the same way they can sort by Due Date.
This functionality exists in other accounting systems and allows businesses to prioritise payments to maximise savings.
4. Automatic Remittance Advice Integration
When a settlement discount is applied, remittance advices should automatically display:
- Original invoice amount.
- Settlement discount applied.
- Net amount paid.
- Remaining balance (if any).
This would improve transparency and reduce supplier queries.
5. Automatic Accounting Treatment
When a discount is applied during payment, Xero should automatically:
- Close the supplier invoice.
- Create the required accounting entry.
- Post the discount to a nominated account.
- Apply the correct VAT treatment based on the original supplier bill.
This would eliminate the need for separate supplier credit notes and reduce the risk of inconsistent VAT treatment.
6. User-Defined Discount Accounts
Allow businesses to nominate a default account such as:
- Settlement Discounts Received.
- Purchase Discounts.
- Early Payment Discounts.
All settlement discounts could then be posted consistently without manual account selection.
7. Settlement Discount Reporting
Add dedicated reporting functionality including:
- Discounts received by supplier.
- Discounts received by month.
- Discounts received by financial year.
- Savings achieved through early payment.
This would allow businesses to measure supplier performance and quantify the benefits of settlement discount programmes.
Comparison to Existing Accounting Systems
QuickBooks Desktop includes settlement discount functionality directly within the Pay Bills screen, allowing users to:
- View discount dates.
- Sort by discount eligibility.
- Capture discounts during payment.
- Automatically clear invoice balances.
A similar workflow within Xero would significantly improve efficiency, reduce administration, improve VAT accuracy and provide a better user experience for businesses that regularly utilise supplier settlement discounts.
Business Benefits
The proposed functionality would:
- Reduce administration time.
- Eliminate manual credit note creation.
- Improve accounts payable efficiency.
- Improve VAT consistency.
- Enhance supplier payment workflows.
- Improve reporting accuracy.
- Increase visibility of savings achieved through early payment.
I believe this enhancement would benefit a large number of Xero users globally and would be a valuable addition to the Accounts Payable module.
Thank you for your consideration, and I look forward to seeing this functionality considered for future development.
I have also seen that similar requests have been pending for almost 2 years
Kind regards,
Shuaib Moolla
CHICANOS