Invoice still shows an amount due after credit notes cover the full amount

The credit notes attached to an invoice add up to the full invoice total, but the invoice still shows a residual amount due and never reaches a paid status. This happens when one of those credit notes was issued as a credit rather than an offset. A credit funds the customer's credit balance for use on future invoices and does not reduce the invoice it was issued from, so the amount still due is exactly the amount that went to credit. It shows up most often on invoices from terminated pay-in-advance subscriptions, where the credit note is generated automatically rather than chosen.

How credit and offset credit notes differ

Both are credit notes, but they settle in different places.

• Offset invoice: the amount reduces the amount due on the invoice the credit note was issued from. Nothing is added to the customer's balance and nothing is left open on the invoice.

• Credit to wallet: the amount is added to the customer's credit balance and is deducted from the subtotal of future invoices. The originating invoice is unchanged and keeps its balance.

The offset option was introduced in late January 2026. Before that, an automatic credit note on an unpaid pay-in-advance termination could only be a credit, so invoices predating the change can show this even though nobody chose the behavior.

How to confirm the cause

Open the invoice and check the type on each credit note attached to it. Add up only the offset-type amounts and compare that to the invoice total. If the gap matches the amount due, a credit-type note is the cause.

Then check the customer's credit balance. The missing amount is usually sitting there as available credit, which confirms where it went and tells you whether it has been spent on a later invoice.

How to resolve the issue

Do not void the credit note and issue a replacement. Voiding does not return the credited amount to the invoice's creditable amount, so a new offset note is sized against the wrong remaining figure and leaves the invoice in a worse state than before. Credit notes cannot be deleted either.

Converting an existing credit into an offset has to be done on Lago's side. Open a support ticket with the affected invoice numbers and confirm that the credit is still unspent, since a credit already consumed by a later invoice cannot be moved. Mention it if the credit note has already been exported to your accounting system, so the correction can be sequenced against your records.

How to prevent this from happening again

When terminating a pay-in-advance subscription from the dashboard, the confirmation dialog includes a Credit note section with three choices: offset invoice, credit to wallet, and do not create a credit note. Offset invoice is pre-selected when the invoice still has an amount due, so the recommended option is already the default in exactly this case.

Terminations sent through the API carry the same choice as a parameter. Integrations that terminate subscriptions programmatically need to set it explicitly, otherwise they can keep producing credit-type notes even after the dashboard behavior looks correct.

This article reflects guidance drawn from customer case resolutions. It is not officially supported documentation and may not apply to all situations.