How to include credit notes in a Xero batch payment
Last updated: September 2026
Short answer: in Xero, supplier credit notes are allocated to bills before the batch payment is built. When you create a payment run in Bills to pay → Batch payment, the batch pays the balances as they stand — so any credit not yet allocated leaves the supplier's statement showing a different net amount. Including credit notes in the batch itself is a popular request on Xero's product idea board (over 900 votes). Here are the manual steps in the right order, and how BulkOps does both steps in one run.
The manual process (allocate first, then batch-pay)
- Open Business → Bills to pay → Credit notes (or the supplier's contact page) and find each unallocated supplier credit note.
- Open the credit note and choose Credit note options → Allocate credit.
- Type the amount to apply against each of that supplier's open bills, then save.
- Repeat for every credit note — allocation is one credit note at a time.
- Now build the batch: Bills to pay → select the bills → Batch payment. The amounts are correct only if step 1–4 caught every credit first.
The important part is ordering: allocate every credit first, then build the batch. On a run with dozens of suppliers and a handful of credits, one missed credit means a supplier is overpaid and a statement to reconcile by hand at month end.
What about Find & Match at the bank?
Since March 2026, Xero's bank reconciliation Find & Match screen can select credit notes, which helps after money has moved. Allocating credits before the batch is still the way to pay the right net amount in the first place.
Applying credits and batch-paying the rest in one run
BulkOps (built by us) connects through Xero's official OAuth and does the netting in the right order, automatically:
- It scans your open bills and unallocated supplier credit notes, and shows a preview: for every bill, the amount due, the credit that will be applied, and the net amount to pay.
- When you approve, it allocates the credits first, then creates one Xero batch payment for the remainders — so each supplier's payment matches their statement.
- It creates the batch inside Xero; money moves only when you send the batch to your bank as usual.
- The whole run is undoable in one click until the batch is reconciled (the batch payment is deleted and the allocations removed), and every write is logged with before/after state, exportable as a CSV audit trail.
- Runs of more than 200 bills are split into multiple batch payments automatically — 200 is Xero's per-batch limit. Base currency only, an API constraint.
Previews are unlimited and free, and your first 25 executed items are free — no card required.
Related guides: bulk credit note allocation (the AR side of the same problem) and our data on Xero's most-requested repetitive-work fixes.
FAQ
Can a Xero batch payment include credit notes?
A batch payment in Xero contains bill payments; supplier credit notes are allocated to bills first, one credit note at a time, and the batch then pays the remaining balances. Including credits in the batch itself is a popular request on Xero’s idea board (over 900 votes); BulkOps does the allocation and the batch in one run.
Does a tool that creates batch payments move my money?
No. A batch payment is an accounting record inside Xero — the same object Xero’s own “pay multiple bills” flow creates. Money moves only when you export the batch to your bank and approve it there, exactly as you do today.
Can a batch payment be undone?
Yes, until it is reconciled. Deleting a batch payment in Xero returns the bills to awaiting-payment status. Once a batch has been reconciled against a bank statement line, it must be unreconciled first.
Do batch payments work in foreign currencies via the API?
No — Xero’s API only allows batch payments in the organisation’s base currency. Foreign-currency bills have to be paid through other flows.