Debtor

A Debtor is a person or business that owes your business money. Most often it’s a customer with an invoice you have issued but not yet been paid. In your accounts, debtors sit under receivables; once the money is received, the balance is cleared.

You may see two types: trade debtors (customers who bought goods or services on credit) and other debtors (amounts due from non-customers, such as employee advances or refunds). Debtors are the opposite of creditors, who are people or businesses you owe.