Create Purchase Invoice

Learn how to record purchase invoices (supplier bills) in Digit Tally for accurate expense tracking and accounts payable management.

What is a Purchase Invoice?

A purchase invoice is a bill from your supplier that you record in your system. It represents:

• Money you owe to suppliers
• Business expenses
• Cost of goods purchased
• Services received
• Accounts payable

[SCREENSHOT: Purchase invoice recording form]

Accessing Purchase Invoice Creation

1. Navigate to https://suppliers.digit-tally.io
2. Click Purchase Invoices in sidebar
3. Click + Record Purchase Invoice

[SCREENSHOT: Record purchase invoice button]

Step 1: Supplier Selection

Choose supplier and optionally link to PO.

Field	Description	Required
Supplier	Select supplier	Yes
Purchase Order	Link to PO (optional)	No
Supplier Invoice Number	Their invoice number	Yes

Link to Purchase Order:

• If created PO, select it
• Items auto-fill from PO
• Quantities can be adjusted
• Prices match PO

[SCREENSHOT: Supplier and PO selection]

Step 2: Invoice Details

Record supplier's invoice information.

Field	Description	Example
Supplier Invoice Number	Their reference number	SUP-INV-12345
Invoice Date	Date on their invoice	Jan 28, 2026
Due Date	When payment is due	Feb 27, 2026
Payment Terms	Payment period	Net 30
Reference	Your internal reference	PO-001

[SCREENSHOT: Invoice details section]

Step 3: Invoice Items

Record what you're being charged for.

Item Details:

Column	Description
Description	Item/service description
Quantity	Number of units
Unit Cost	Cost per unit (NGN )
Amount	Calculated total
VAT	Input VAT (7.5%)
Total	Cost with VAT

Adding Items:

1. Enter description or select from catalog
2. Enter quantity received/purchased
3. Enter unit cost from supplier invoice
4. Add VAT if applicable
5. Add more lines as needed

[SCREENSHOT: Purchase invoice items table]

Step 4: Tax Calculations

Handle VAT and WHT properly.

Input VAT

VAT on Purchases:

Subtotal: NGN 100,000
VAT 7.5% (Input VAT): NGN 7,500
Total: NGN 107,500

You can reclaim this VAT on your VAT return if you're VAT-registered.

[SCREENSHOT: VAT calculation]

Withholding Tax (WHT)

If you must withhold tax:

1. Click Add WHT
2. Select WHT rate:
   • 5% (Contracts)
   • 10% (Professional Services)
   • 2.5% (Rent)
3. WHT deducts from amount payable
4. You pay reduced amount to supplier
5. Remit WHT to FIRS

Example:

Invoice Total: NGN 107,500
WHT 10%: -NGN 10,000
Net Payable to Supplier: NGN 97,500
WHT to Remit to FIRS: NGN 10,000

[SCREENSHOT: WHT selection and calculation]

Step 5: Attach Supplier Invoice

Upload supplier's invoice document.

Attachment Options:

• Scan physical invoice
• Upload PDF from email
• Take photo with phone
• Drag and drop file

Benefits:

• Reference original document
• Audit trail
• Dispute resolution
• Compliance

[SCREENSHOT: File upload interface]

Step 6: Expense Categories

Categorize expenses for reporting.

Common Expense Categories:

• Cost of Goods Sold (COGS)
• Office Supplies
• Rent
• Utilities
• Professional Services
• Marketing & Advertising
• Travel & Transportation
• Equipment
• Maintenance

Assigning Categories:

1. Select category for each line item
2. Categories affect financial reports
3. Helps with tax deductions
4. Enables expense analysis

[SCREENSHOT: Expense category selection]

Step 7: Payment Information

Specify payment plans if applicable.

Payment Options:

• Pay Later - Add to accounts payable (most common)
• Paid - Already paid (record payment)
• Partial Payment - Part paid, part pending

If Paid:

• Enter payment date
• Select payment method
• Enter transaction reference
• Record from which bank account

[SCREENSHOT: Payment recording section]

Step 8: Save Purchase Invoice

Save Options:

• Save - Record the purchase invoice
• Save and Pay - Record and mark as paid
• Save and Schedule Payment - Set payment reminder

What Happens:

• Expense recorded in accounting
• Accounts payable increases (if unpaid)
• VAT input recorded
• WHT liability recorded (if applicable)
• Supplier balance updates

[SCREENSHOT: Save options]

Recording Payment Later

When ready to pay supplier:

1. Open purchase invoice
2. Click Record Payment
3. Enter payment details:
   • Payment date
   • Amount paid
   • Payment method
   • Bank account used
   • Transaction reference
4. Save payment

Payment Methods:

• Bank Transfer (most common)
• Cash
• Cheque
• Mobile Money

[SCREENSHOT: Record payment form]

Purchase Invoice Reports

Track expenses and payables:

Report	Description
Accounts Payable	All unpaid supplier invoices
Purchase by Supplier	Spending per supplier
Expense by Category	Categorized expenses
VAT Input Report	VAT reclaimable
WHT Report	WHT to remit

[SCREENSHOT: Purchase invoice reports]

Best Practices

Recording Tips

1. Record Promptly - Enter invoices when received
2. Attach Documents - Always upload supplier invoice copy
3. Verify Details - Check amounts match supplier invoice
4. Categorize Correctly - Proper categories for accurate reports
5. Track Due Dates - Avoid late payment penalties
6. Match to POs - Link to purchase orders when applicable
7. Review Before Saving - Double-check all details

Common Mistakes to Avoid

• ❌ Not recording VAT correctly
• ❌ Forgetting to attach supplier invoice
• ❌ Wrong expense categories
• ❌ Missing payment due dates
• ❌ Not matching to purchase orders
• ❌ Incorrect WHT calculations

Troubleshooting

Issue: Cannot Find Supplier

• Solution: Add supplier first from Suppliers section. Use quick-add option during invoice creation.

Issue: Amounts Don't Match Supplier Invoice

• Solution: Double-check quantities and unit prices. Verify VAT is calculated correctly. Check for any discounts applied.

Issue: Wrong Expense Category Selected

• Solution: Edit purchase invoice if not yet paid. Correct category and save changes.

What's Next?

• Create Purchase Order - Order from suppliers
• Bank Reconciliation - Match payments

Expense Tracking

Accurate purchase invoice recording is essential for knowing your true business costs, calculating profit margins, and preparing tax returns.