Define: Prepayment

UK Accounting Glossary

Definition: Prepayment

Quick Summary of Prepayment

An amount paid for in advance for an benefit to the business, such as insurance premiums or rent in advance. Initially recognised as an asset, then transferred to expense in the period when the benefit is enjoyed. (Also called a prepaid expense.)

What is the dictionary definition of Prepayment?

Dictionary Definition

A payment in advance.


Synonyms For Prepayment

down payment, advance payment, prepaid, advance, pre-payment

Cite Term

To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.

Page URL
Modern Language Association (MLA):
Prepayment. Payroll & Accounting Heaven Ltd. April 03, 2020
Chicago Manual of Style (CMS):
Prepayment. Payroll & Accounting Heaven Ltd. (accessed: April 03, 2020).
American Psychological Association (APA):
Prepayment. Retrieved April 03, 2020, from website:

Definition Sources

Definitions for Prepayment are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 23rd December 2018.