A partial payment is a payment for less than the full amount due on an invoice or an installment. The invoice stays open with a smaller balance until the rest is paid, credited or written off. Record the payment against the specific invoice so the remaining balance is accurate. A partial payment is different from a planned installment. An installment is a scheduled share of the total that both sides agreed to in advance. A partial payment falls short of what was due on that date.
What is a partial payment?
A partial payment is money received against an invoice that doesn't cover the whole amount due. The invoice isn't paid. It is partly paid, and the difference stays on the customer's account as the balance due.
How is it different from an installment?
The two can look alike in the bank account. The difference is the agreement.
| Installment | Partial payment | |
|---|---|---|
| Agreed in advance | Yes, in the plan or contract | No |
| Amount | The scheduled share | Less than what was due |
| Afterwards | The plan carries on | A shortfall to resolve |
On a payment plan, each installment is the full amount due on its date. A partial payment happens when the customer pays less than that installment.
A worked example
A customer is on a $14,800 plan: a $1,500 deposit, 11 payments of $1,108.33 and a last payment of $1,108.37. On the due date of the fourth payment they pay $600.
- Due that date: $1,108.33
- Paid: $600.00
- Left on that payment: $1,108.33 − $600.00 = $508.33
You then decide with the customer how the $508.33 gets paid. It can be collected as an extra payment, added to the next payment or spread over the payments that remain. Changing the plan's amounts changes the agreement, so put the new schedule in writing.
How do you record a partial payment?
Record it against the specific invoice or installment it pays, not as a loose payment on the account. That keeps the aging report honest. It shows exactly which invoice is still open and for how long.
QuickBooks Online's support article on recording invoice payments says "QuickBooks assumes that the customer is paying the entirety of the invoice, but if this is a partial payment, you can change the payment amount." Once the payment is saved, the invoice status updates and the customer's outstanding balance goes down by the amount received.
Should you accept partial payments?
That is a policy choice. Accepting one brings in some cash and keeps the customer engaged. The risk is a growing balance nobody chases. If you accept them, decide in advance:
- Whether a partial payment counts as on time for any late fee in your terms
- How the shortfall gets scheduled
- Who follows up, and when
Write the policy into your payment terms so customers know it before it comes up.
Every figure on this page was checked against these sources on Oct 6, 2026. General information, not legal or tax advice.