Remittance Advice Template for Supplier Payment Notification

Purpose and legal context of remittance advice

A remittance advice is a document sent by a buyer to a supplier at the point of payment, confirming the total amount paid and listing each invoice or credit note included in that payment. While there is no statutory requirement to issue remittance advice under UK law, it is widely considered standard commercial practice and is expected by most suppliers with structured accounts receivable functions.

Without remittance advice, suppliers must manually investigate unallocated receipts in their bank statements — a process that consumes time and can result in incorrect debt-chasing, credit holds being incorrectly applied, or aged debtor reports being overstated. Both parties benefit from the clarity a remittance provides.

Fields to include in the remittance advice template

• Your company name, address, and company registration number
• Supplier name and accounts receivable contact
• Date of payment
• Payment method (BACS, CHAPS, Faster Payments, cheque)
• Your bank's sort code and account number (partial, for reference only)
• For each item: supplier invoice number, your PO number, invoice date, invoice amount, and amount paid
• Any credit notes deducted, with reference numbers
• Early payment discount deducted (with basis stated, e.g. 2% for payment within 10 days)
• Total amount remitted
• Contact name and email for queries

Integrating remittance advice into your payment run process

Most UK accounting software packages (Xero, Sage, QuickBooks, and similar) generate remittance advice automatically as part of a payment run and can email them directly to supplier contacts at the time of payment. If your system does not support this, a simple spreadsheet-based template populated from your payment schedule achieves the same result with minimal additional effort.

Where a payment incorporates a deduction — whether a negotiated early payment discount, a credit note, or a retention amount — the basis for the deduction must be clearly stated on the remittance. Unexplained deductions are one of the most common causes of supplier disputes and can result in the deducted amount being rechased as unpaid. If you are uncertain whether a deduction is contractually valid, confirm with your legal adviser before issuing the remittance.