> For the complete documentation index, see [llms.txt](https://help.digits.com/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://help.digits.com/business-bills-and-invoices/external-payments.md).

# Marking a Bill or Invoice as Paid (External Payments)

If a bill or invoice was paid outside of Digits (for example, a mailed check, wire, or a separate system), you can mark it as paid to keep your AP, AR, and reports accurate. No money moves in Digits—this is a record update for tracking and reconciliation.

***

### Marking a Bill as Paid (AP)

If you paid a bill outside of Digits:

1. Click **Bills** in the left navigation menu.
2. Find the bill, then click **More Actions** in the top-right corner.
3. Select **Mark as Paid**.
4. Choose the **payment date**.
5. Select the **account** the payment came from (the "Pay Out" account)—usually the bank account the money left from.
6. (*Optional*) Add a **reference number** (e.g., a check number) and/or an **internal memo** for context.
7. Click **Mark as Paid** to confirm.

{% hint style="warning" icon="lightbulb-exclamation-on" %}
**Notes:** 

* You can only mark as paid if all **required fields** on the bill are complete; otherwise, the action is disabled.
* This does **not** send money or notify the vendor. It’s a record update for tracking and reconciliation.
* **This action can't be undone** (same as invoices—your only recourse afterward is to void).
* You can't set a payment date that falls **on or before a closed-period date**, or before the bill date—those dates are disabled in the picker and will show an error.
  {% endhint %}

***

### Marking an Invoice as Paid (AR)

If you paid an invoice outside of Digits (check, wire, or a transfer):

1. Click **Invoices** in the left navigation menu.
2. Open the invoice and select **Mark as Paid**.
3. Choose the payment date.
4. Select the **account where the payment was received**—almost always the bank account the funds landed in.
5. (Optional) Add a **reference number** (e.g., a check number) and/or an **internal memo** for context.
6. Click **Mark as Paid**.

{% hint style="warning" icon="lightbulb-exclamation-on" %}
**Notes:**

* The **Pay In** list includes only **balance sheet accounts** (bank, asset, liability, and equity accounts). Select the **bank account** where you received the payment.

  Revenue was already recorded when the invoice was created, so marking it as paid simply debits the bank account and credits Accounts Receivable to settle the balance. (This is also why revenue accounts aren't offered here—selecting one would double-count income.)
* Marking an invoice as paid confirms the payment was collected **outside of Digits**, and **this action can't be undone**.
* Digits Invoice Clearing is applied automatically only when a customer pays through Digits. You don't select it for offline payments.
* This is a record update—no funds move in Digits.
  {% endhint %}

***

### Frequently Asked Questions

<details>

<summary>Why is Mark as Paid disabled?</summary>

One or more required bill fields are missing. Open the bill, complete all required fields, then try again.

</details>

<details>

<summary>Will marking a bill or invoce as paid update the ledger automatically?</summary>

Yes. Digits records the payment against the bill or invoice and updates the ledger so AP or AR stays accurate.

</details>

<details>

<summary>If I manually mark a bill or invoice as paid, can I attach proof of payment?</summary>

Yes. Add a note in Comments and upload supporting docs (e.g., a cleared check image) to Vault.

</details>

<details>

<summary>Can I undo Mark as Paid?</summary>

No. Once an invoice is marked as paid, the status can't be reversed—the confirmation dialog notes that the action can't be undone. If you marked an invoice as paid in error, your options are:

* **Void the invoice** — this cancels it and posts a reversing entry to back out the accounting. (Voiding is also permanent and can't be undone.)
* **Duplicate** the invoice if you need to re-issue it, then send the new copy.

</details>

***

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{% column width="66.66666666666666%" valign="middle" %}
Got a question or feedback? Our team is all ears—come say hello!
{% endcolumn %}

{% column width="33.33333333333334%" valign="middle" %}

<p align="center"><a href="https://portal.usepylon.com/digits/forms/get-in-touch-with-digits-support" class="button primary" data-icon="envelope-open-text">Contact Digits Support</a></p>
{% endcolumn %}
{% endcolumns %}

***


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