A prepay occurs when a tenant makes a payment before a corresponding charge has been recorded; for example, when a tenant pays the rent on the twentieth of the month, but the rent charge is not created until the thirtieth. If there are no open charges, the funds are marked as a prepayment. The prepayment is then applied to the rent charge after the charge is created on the thirtieth of the
month.

A prepay can also occur when a tenant overpays. For example, a tenant owes 1200 but makes a payment for 1400. Breeze pays off the existing charges and then creates a prepay for the remainder (200).

By default, prepayments are applied to the next available charge, but if you want, you can turn off the automatic application of prepayments, and apply them manually.

Breeze comes with a default setup for prepayments: an income GL account, a liability GL account, and a charge code. The income account is for cash books, the liability account for accrual books. The charge code is linked to the income account.

To view the default accounts, go to Company Settings > Account Settings.

To view the charge code, go to Admin > Charge Codes, and click on the prepay charge code.

We recommend you use the default setup; however, if you modify the default Chart of Accounts, you might need to change these settings.