An early payment discount is a discount that you can give to your customers for paying before the invoice due date. This guidance advises on apply to how apply this.

Creating the Credit Note

To apply an early payment discount, go to Sales > New Invoice > Create a new invoice for this customer > Add a line item with a negative rate (i.e. -£10). This is a credit note that you will use to settle the original invoice, be sure to leave this as unpaid.

Applying the Credit Note

Return back to the original invoice, you'll see a button appear under the payment details section labelled Apply Advance Payment and a drop down box with the invoice number of your credit note appear. Click the Apply Advanced Payment button. The invoice will now be settled.