Paying a supplier twice is one of the most common and most avoidable losses in a small business. It rarely happens because someone is careless; it happens because the same invoice reaches the business by two routes and nobody can see that the second one is not new.
How duplicates get in
| Route | What happens |
|---|---|
| Email and post | The supplier emails a PDF and posts a paper copy a week later |
| Reminder treated as a new invoice | A statement or “second notice” is entered as a fresh bill |
| Re-sent PDF | The supplier corrects a typo and re-sends with the same number |
| Two people, one inbox | Two colleagues pick up the same invoice from a shared mailbox |
| Card payment plus invoice | A bill is paid by card at purchase and later entered and paid again from the invoice |
| Bank feed | A feed re-imports lines after a reconnection, creating duplicate bank transactions |
The last case is different: the business has not paid twice, but the books say it has.
Checks before an invoice is entered
Most accounting software warns when you enter a bill with the same supplier and invoice number as an existing one. Make sure that warning is switched on and that people do not override it by adding a suffix. Then add the checks software does not do for you:
- Same supplier, same amount, within 30 days. Run this as a report weekly; it catches re-sent invoices with a new number.
- Normalise invoice numbers. “INV-0042”, “INV42” and “42” are the same document. Enter numbers exactly as printed, without your own prefixes.
- Reminders and statements are never entered. Only invoices and credit notes go into the purchase ledger.
- Mark paper copies. If the supplier insists on post, write “emailed copy entered” on the paper version, or ask them to stop posting.
Checks before a payment run
The payment run is your last chance. Before approving it:
- sort the proposed payments by supplier and look for the same amount appearing twice;
- check that nothing in the run was already paid by card or direct debit;
- compare large payments with the supplier’s statement, if you have one.
A short supplier payment run routine with a second approver is the strongest single control here.
When you have already paid twice
Do not delete the second invoice. Correct the books so they show what really happened, then recover the money.
Step 1: reverse the duplicate invoice. Void it or post a credit note in your own records with a narration such as “Duplicate of INV-20931”. The supplier account now shows a debit balance: the supplier owes you.
Step 2: decide how to recover.
| Option | When it suits | Bookkeeping |
|---|---|---|
| Refund | You do not buy from them often | Match the refund receipt against the supplier’s debit balance |
| Offset | You will receive another invoice soon | Allocate the debit balance against the next invoice, and pay only the difference |
Ask the supplier in writing, quoting both payment dates and the invoice number. Agree which option they will use, and do not offset unilaterally without telling them, or their ledger and yours will disagree.
Step 3: check the VAT. If both copies of the invoice were entered, you have probably reclaimed the input VAT twice. Reversing the duplicate fixes it in the current period. If the duplicate fell into a VAT return you have already submitted, the reversal in the current period corrects it as long as the net value of errors is within HMRC’s limit for correcting on the next return; see VAT corrections after filing.
Duplicates on the sales side
The same problems happen in reverse. A customer may pay your invoice twice, leaving a credit balance on their account. Do not quietly keep it or treat it as income: refund it or agree to offset it against their next invoice. Long-standing credit balances are covered in old customer credit balances and supplier debit balances.
Look back once a year
Before the year end, run the “same supplier, same amount” report across the whole year and review every supplier with a debit balance. Recovering a duplicate payment from last spring is much easier in December than after the accounts have been signed.