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.


Full Definition of Prepayment


Prepayment FAQ's

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. November 22, 2019
Chicago Manual of Style (CMS):
Prepayment. Payroll & Accounting Heaven Ltd. (accessed: November 22, 2019).
American Psychological Association (APA):
Prepayment. Retrieved November 22, 2019, from website:

Definition Sources

Definitions for Prepayment are sourced/syndicated 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.