Dynamics 365 Business Central – Use Payment Tolerance to Write Off Amounts


There might be occasions when you wish to write off the amount of an invoice. For example if a customer has underpaid and you don’t wish to leave the balance on the invoice. You can achieve this using a payment tolerance.


In this scenario I have a posted invoice for £101.00 and the customer has sent a payment of £100.00. Instead of applying the payment and leaving a balance on the invoice of £1.00, we’ll write off the £1.00 using a payment tolerance.

Below is the invoice for £101.00 as shown in the Customer Ledger Entries page:

I’ll now go to a Cash Receipts Journal and raise the payment below and click “Apply Entries” to apply this to the Invoice (* Please note you can also post the payment for £100.00 and apply afterwards using the same technique)

Once in the “Apply Customer Entries” page I first change the “Pmt. Disc. Tolerance Date” so its after the posting date of the invoice, then I’ll add a “Max. Payment Tolerance” of £1.00 and finally enter £100.00 in the “Amount to Apply” as per below

Now, back in the Cash Receipt Journal window I’ll select “Preview Postings” so I can double check this is going to work as intended prior to clicking “Post”. I can check this by viewing the “Detailed Ledger Entries” and in this scenario everything seems to be fine as I have a “Payment Tolerance” entry type in the Detailed Ledger Entries.

As everything is fine I’ll now post this transaction, which will close the Invoice as fully applied:

After posting the Payment the remaining amount on the Payment and Invoice are both £0.00. If I click “Remaining amount” on the Payment I can see the “Payment Tolerance” in the Detailed Ledger Entries.

I hope you find this useful.

Thanks for reading!

Dynamics 365 Business Central: Posting a Sales Refund and applying to a Credit Memo


I come from a Dynamics GP background and I’ve always found the process for refunding in Dynamics GP to be rather long winded and not very intuitive. The main issue is there’s no specific option for creating a refund, so I was very interested to test out the option in Dynamics 365 Business Central.

In this article I’ll first explain a potential scenario when a refund would need raising and applying to a credit note, then briefly explain how I’d do this in Dynamics GP, before finally going through the refund process in Dynamics 365 Business Central.

The Scenario

The scenario is as follows:

A customer buys some goods so we issue an invoice. The customer sends us payment which we apply to the invoice however they subsequently send the goods back so a credit note is issued. Finally some time later the customer requests their money back as they aren’t planning on doing business with us anymore.

Therefore, prior to issuing the refund, the account would have an Invoice applied to a Payment and a unapplied Credit Memo as per below

To complete the process we now need to issue the customer with a refund and apply this to the credit memo.

Dynamics GP

In Dynamics GP its not possible to post a “Refund” type cash receipt and apply it to the credit memo. One solution would be to void the credit memo and post a “Return with cash” similar to below:

Alternatively you could post a debit type document, apply this to the credit memo and then create the customer in payables and post a payment, however both cases aren’t ideal. (you can also use “Refund Cheques”, but again this involves having the customer setup in payables which again isn’t ideal)

Dynamics 365 Business Central

In Dynamics 365 Business Central you can post a “Refund” and apply it to the “Credit Memo” using the “Cash Receipts Journal”. Below are the steps to achieve this:

First go to the “Cash Receipt Journal” page:

Enter the refund as per below:

Next apply this to the credit memo we are refunding:

And then post the Cash Receipt Journal.

If we now review the account we can see the refund has been successfully applied to the Credit Memo.


I do like this functionality in Dynamics 365 Business Central. Its intuitive and doesn’t require lots of different steps. Although I’m a firm fan of Dynamics GP I do find this an improvement when compared to the current functionality available in Dynamics GP.

Thanks for reading.

Dynamics GP – Error “Install Microsoft Word” when emailing a large number of Customer Statements

A client was experiencing the error “Install Microsoft Word” on the exception report for lots of statements when emailing a high volume of customer statements when running Dynamics GP 2013.

After searching online I found the following thread in the community forum https://community.dynamics.com/gp/f/32/t/137272

This mentioned the exact same issue and a user named Pam Robertson posted to advise of a fix in later versions of Dynamics GP.

I was curious to find this in the Microsoft documentation so I tracked down the fix list for Dynamics GP 2013 and a fix is indeed listed as per below for version 12.00.1920

I’ve since installed this at the client and can confirm it fixed the issue!

Therefore if you are on Dynamics GP 2013 (version 12.00.1920) or earlier and running into this issue applying this service will fix the issue.

A very quick post but I thought it worth putting out there in case anyone else encounters this issue and needs the evidence to show this is fixed in a later version of Dynamics GP.

Thanks for reading.