How do I deal with a Customer who has overpaid their account?
A Customer has overpaid their account. How do we process the difference to ensure our banking is correct?
Pay off all outstanding invoices and then select Unallocated and enter the balance into there. This will show up as a credit balance on their account and may be used to offset future invoices.
If the credit balance is to be refunded then this can be achieved by processing a negative unallocated customer payment.
Also see Articles "How Do I Refund Payment to a Customer" and "Customer Refund to Their Bank Account"