Purchase Invoice in ERPNext
A Purchase Invoice is a document received from suppliers that records the amount payable for goods or services purchased. It is the accounting counterpart of a Sales Invoice and represents a liability for the company.
Purchase Invoices record supplier liabilities, update accounts payable, and generate accounting entries for expenses or assets upon submission.
Access Path
Home > Accounting > Accounts Payable > Purchase Invoice
1. Prerequisites
Before creating a Purchase Invoice, ensure the following masters are created:
- Item
- Supplier
- Purchase Order
- Purchase Receipt (optional)
2. Creating a Purchase Invoice
A Purchase Invoice can be created from a Purchase Order or Purchase Receipt, or directly.
- Go to Purchase Invoice list and click New.
- Select Supplier.
- Set Posting Date and Due Date.
- Add Items and quantities.
- Rates and amounts will be fetched automatically.
- Save and Submit the document.
3. Key Options
3.1 Additional Options
- Is Paid: Marks invoice as already paid via Payment Entry.
- Is Return (Debit Note): Used when goods are returned to supplier.
- Apply Tax Withholding Amount: Enables TDS deduction if applicable.
3.2 Statuses
- Draft – Not submitted
- Submitted – Posted to accounts
- Paid – Fully settled
- Partly Paid – Partially settled
- Unpaid – Pending payment
- Overdue – Past due date
- Return – Goods returned
- Cancelled – Reversed entry
4. Accounting Dimensions
Purchase Invoices can be tagged using dimensions like Cost Center or Project for better financial reporting.
5. Holding Purchase Invoice
Invoices can be placed on hold before or after submission:
- Hold Invoice: Prevents payment processing
- Block Invoice: Used for submitted invoices
- Release Date: Automatically unholds invoice on a specific date
6. Supplier Invoice Details
- Supplier Invoice No: Reference number from supplier
- Supplier Invoice Date: Date of supplier billing
7. Items Table
Each item line includes:
- Item Code, description, and UOM
- Quantity and Rate
- Expense or Asset Account mapping
- Discounts and Taxes
- Batch / Serial numbers if applicable
8. Taxes and Charges
Taxes are applied using:
- Purchase Taxes and Charges Template
- Tax Category
- Item Tax Templates (if configured)
9. Accounting Impact
On submission of Purchase Invoice:
- Expense/Asset account is debited
- Supplier account is credited
- Taxes are booked to respective tax accounts
Accounting Entry Example
- Debit: Expense / Asset
- Debit: Taxes (if applicable)
- Credit: Supplier
10. Is Paid Scenario
If marked as “Is Paid”:
- Supplier is debited
- Bank/Cash is credited
11. Holding Payments
Invoices can be blocked to prevent payment until reviewed or released. This helps control cash flow and approvals.
12. Provisional Accounting (Advanced)
Used for non-stock items when expense recognition is required before invoice posting. Entries are first booked via Purchase Receipt and later adjusted on Purchase Invoice submission.
