Customer deposits and advance payments ledger

What the customer deposits and advance payments ledger does

Money received before the work is done is a liability, not income. This ledger records each deposit with the customer and description, the amount applied to invoices, any refunds and the balance you still hold, with a status of held or closed, so you do not treat a customer's money as your own and can answer any question about it.

Who it is for

Businesses that take deposits, such as caterers, builders, event planners and furniture makers, and accountants who must show deposits correctly in the accounts.

How to use the workbook

1. Record each deposit with the date, the customer and a description.
2. Enter the amount received.
3. When the deposit is applied to an invoice or refunded, enter the amount.
4. Read the balance held and the status for each customer.
5. Save a copy under a new name for each month or year, so earlier records stay as they were.

What is inside

• Deposits received and amounts applied or refunded
• Balance held for each customer
• Held or closed status
• Total held at the top
• Summary of deposits by status with a chart

The workbook has these sheets: Instructions, Deposits, Summary. The main table has the columns Date; Customer; Description; Deposit received; Applied to invoice; Refunded; Balance held; Status. Yellow cells are for you to fill in and grey cells calculate by themselves, so leave the grey cells alone. The example rows show how it works; type over them with your own entries.

Tips for getting it right

• Keep customer deposits separate from working cash where you can.
• Give a receipt for every deposit and say what it is for.
• Agree in writing when a deposit is refundable.
• Review old deposits regularly and settle or refund them.

Why keep this record

Accounting records let you answer three questions at any time: what came in, what went out and who owes whom. Kept consistently they also make tax returns, loan applications and the sale of a business much easier, because the evidence is already organised. Entering transactions the day they happen is far cheaper than reconstructing them at year end.

Questions people ask

Do I need to know Excel formulas? No. Type into the yellow cells and the rest is worked out for you. The formulas are visible if you want to see how a figure is reached.

Can I add rows or change the layout? You can add your own columns to the right and your own notes. If you insert rows inside a table, copy the grey formula cells down so the new rows calculate too.

Will it work on my phone or in Google Sheets? Yes for viewing and typing, but dropdown lists and the charts look best in desktop Excel or LibreOffice.

Keeping it safe and up to date

Good accounting records are a legal duty as well as a management tool: keep the supporting receipts and invoices with the workbook, and keep each year's copy for at least five years. Work on a copy, never on your only file, and back it up.

Read how to keep business records for KRA for the wider picture. Free calculators that go with it: Vat calculator. See more accounting templates or ask us for a custom one.

The workbook works in Microsoft Excel, LibreOffice and Google Sheets. It is a tool to help you work out and record figures, not tax, legal or accounting advice, and it is not affiliated with the Kenya Revenue Authority. If something does not work as described, contact us and we will put it right.

Related guides, calculators and templates

• Free calculator: VAT Calculator
• Guide: VAT invoices and quotations in Kenya: what to include and common mistakes
• Guide: Buying off-plan property in Kenya: the risks and the checks to run
• Guide: Import VAT in Kenya: how to claim it back on your VAT return
• Another template: Credit note with VAT
• Another template: Customer invoices and aged receivables tracker
• Another template: Expense claims and reimbursement log

Need something different? Request a custom template, browse all guides or see every Excel template.