Remittance Advice Template
Tells a supplier exactly which invoices your payment covers.
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| To | [supplier] |
| Address | [supplier address] |
| Payment date | [date] |
| Reference | [reference] |
| Invoice | Amount paid |
|---|---|
| [add one line per invoice] | |
| Total paid | $ 0.00 |
This is a remittance advice, not an invoice or a receipt. The payment shown has been sent to the bank account we hold for you. Please tell us if it does not arrive within three working days.
What is a Remittance Advice?
A remittance advice tells a supplier which invoices your payment covers. It matters because a bank transfer arrives as a single number with a reference field that is often truncated or blank. Without a breakdown, the supplier's accounts team allocates the money by guesswork, some invoices stay open, and you get chased — sometimes formally — for amounts you have already paid.
Anyone running a payment run sends these: accounts payable teams, bookkeepers, practice managers, and individuals settling several invoices from one tradesperson at once. They matter most where the payment is not a simple one-for-one match — a batch covering fifteen invoices, a part payment, a payment net of a credit note, a payment with tax withheld at source, or a cross-border transfer where bank charges have reduced the amount that actually landed in the supplier's account.
A remittance advice is not a tax document anywhere, so no revenue authority prescribes its format. What varies is what has to be shown on it. Withholding regimes such as TDS in India or backup withholding in the US require the deduction to be visible and a certificate to follow. Construction industry deduction schemes in the UK work similarly. Large UK companies also report on payment practices. And every payment network — SEPA, BACS, ACH, UPI — truncates reference fields differently, so check what your bank actually transmits.
Sending an advice does not pay anyone. It is a notification, not an instruction to your bank, and issuing it a week early does not make the money arrive early. It is not a promise to pay that a supplier can rely on if the run is later cancelled. It is not a credit note either: showing a deduction on a remittance does not create the credit, and the supplier still needs the underlying credit or debit note to post against.
What to put in a Remittance Advice
These are the details this template asks for. Anything left blank is marked in red on the preview so you can see what is still missing.
| Field | What goes in it |
|---|---|
| Business name | For example: Barton Supply Co. |
| Your address | For example: Unit 7, Barton Road, Columbus, OH 43212 |
| Supplier | For example: Northgate Timber Inc. |
| Supplier address | For example: Unit 3, Foster Avenue, Cleveland, OH 44113 |
| Remittance no. optional | For example: RA-2026-0077 |
| Payment date | Free text |
| Payment reference optional | For example: FPS 20260830 KUSAGRA |
| Invoices paid | One per line: Invoice ref | 1 | Amount |
How to write a Remittance Advice
List every invoice number and amount
One line per invoice: number, invoice date, and the amount being paid against it. Where you are paying part of an invoice, show the invoice total and the amount paid separately so the balance is obvious. Suppliers with several invoices at the same value cannot allocate on date and amount alone — the number is what does the work.
Show deductions on their own lines
Credit notes, debit notes, withholding tax, retention, settlement discount and bank charges each get a line with a reference. The arithmetic must be visible: gross, less each deduction, equals the transfer. A supplier who can follow the subtraction accepts it; one presented with a bare net figure opens a query on the whole payment.
State the payment date, method and reference
Say when the payment was released, by what route, from which bank account, and the reference the supplier will see on their statement. If your bank truncates the reference to a short code, print that code exactly as it will appear. That single detail is what lets their team find your money among the day's receipts.
Send it to accounts receivable, on the day
Email it to the supplier's remittance or AR address, not to the sales representative who will forward it eventually or not at all. Send it the same day the payment goes out, so it arrives before or with the money. An advice that turns up a fortnight later has already failed to prevent the chasing it existed to prevent.
Check the total against the bank amount
Before sending, confirm the sum of the lines equals the amount actually transferred, to the currency unit. A mismatch of even a small amount stops allocation entirely, because the supplier cannot tell which line is wrong. For foreign currency payments, state the currency and whether charges were shared or borne by you.
Common mistakes
- Sending an advice whose total does not match the amount received stops the supplier allocating any of it until someone works out which line is wrong.
- Showing a deduction for a credit note that was never actually issued leaves a permanent difference the supplier's ledger can never clear.
- Emailing the advice to a sales contact rather than accounts receivable means it never reaches the ledger and the chasing continues regardless.
- Listing invoice dates and amounts without invoice numbers makes allocation guesswork for any supplier who has billed you twice at the same value.
- Deducting withholding tax without stating the rate, the section and when the certificate will follow leaves the supplier booking the shortfall as unpaid.
Frequently asked questions
What is a remittance advice?
A note sent by a payer to a supplier setting out which invoices a payment covers and what has been deducted. It travels alongside the money rather than being part of it. Its whole purpose is allocation: turning one figure on a bank statement into a set of closed invoices in the supplier's ledger without anyone having to telephone anyone.
Is a remittance advice legally required?
Generally no. It is a commercial courtesy that has become standard practice because it prevents disputes. Some contracts and supplier onboarding terms require one, and some payment or deduction schemes require particular information to be given to the payee. Check your supply agreement and any withholding rules that apply, but in most cases you send one because it saves work, not because law compels it.
What is the difference between a remittance advice and a receipt?
A remittance advice goes from payer to payee saying money has been sent and what it covers. A receipt goes the other way, from payee to payer, confirming money has arrived. They describe the same payment from opposite ends. Neither replaces the invoice, which is the document that created the obligation in the first place.
Should I send a remittance advice before or after paying?
Send it the same day the payment is released. Sending it earlier risks the supplier expecting money that has not left, particularly if the run is amended. Sending it days later defeats the purpose, because the unallocated cash has already generated a query. Same-day is the practice most accounts receivable teams ask for.
How do I show a credit note on a remittance advice?
Give it its own line, with the credit note number and the amount as a negative, positioned so the arithmetic reads down the page: invoices, then deductions, then the net transferred. Do not net a credit off an invoice line silently — the supplier needs to see both references to close both documents in their ledger.
This page explains general practice and is not legal advice. Requirements differ between countries and, in some cases, between states — check what applies where the document will be used.