Voiding and Refunding Client Payments

After a payment has been recorded, you may need to reverse it entirely. Discovery supports two ways to do this: voiding a payment and refunding a payment. Both actions will remove the payment from any invoices it was applied to and restore those invoices to their previous balance, but they are used in different situations and record different information in your accounting history.

When to Void a Payment

Use Void when a payment needs to be reversed entirely — most commonly when a payment was returned due to non-sufficient funds (NSF) or when it was entered in error.

When you click Void, a modal will appear and ask: "Is NSF?"

If you select Yes (NSF):

• The void reason is automatically set to NSF — no reason field is shown.
• The void date defaults to today's date. You may adjust it if needed.

If you select No:

• A Void Reason field appears. You are required to provide an explanation.
• The void date defaults to the payment's original receipt date. You may adjust it if needed.

What happens when a payment is voided:

1. The payment is marked as voided and can no longer be edited or applied.
2. The Applied Amount on the payment is set to zero.
3. Any invoices the payment was applied to are unapplied — their balances are restored, and they will return to a Delinquent status if a balance remains.
4. The applied payment records linking the payment to those invoices are removed.
5. Reversing journal entries are created in your accounting integration to offset the original entries, so your GL remains balanced.

Note: A payment can only be voided if it has not already been voided or refunded.

When to Refund a Payment

Use Refund when a payment was legitimately received but money is being returned to the client — for example, due to a billing dispute, overpayment, or service cancellation.

Refunding a payment requires no additional inputs beyond your confirmation.

What happens when a payment is refunded:

1. The payment is marked as refunded and can no longer be edited or applied.
2. The Applied Amount on the payment is set to zero.
3. Any invoices the payment was applied to are unapplied — their balances are restored, and they will return to a Delinquent status if a balance remains.
4. The applied payment records linking the payment to those invoices are removed.
5. Reversing journal entries are created in your accounting integration to offset the original entries, recorded under a separate refund document number for auditing purposes.

Note: A payment can only be refunded if it has not already been refunded or voided.

Both actions are permanent and cannot be undone. If you have questions about which option is appropriate, please reach out to your account manager or contact our support team.

If you have additional questions or need more in depth information, please feel free to send us a message using the help beacon in the lower right-hand corner.