Invoice to Credit Note
The Credit All or Part of an Invoice screen issues a Credit Note against an existing Sales Invoice. Use it for sales returns, to correct overbilling, or to give a customer a discount after the invoice has already gone out. It adjusts the customer balance and, depending on the type you choose, returns items to inventory.
Where to find it
Open an invoice from the Invoices list and choose Credit This, or use Credit This on the Sales Invoice View.
Header Information
Header details come straight from the original Sales Invoice, so the credit stays correctly linked.
| Field | Editable | Description |
|---|---|---|
| Customer & Branch | No | The client receiving the credit. Locked to the original invoice. |
| Reference | Yes | The unique identification number for this Credit Note. |
| Crediting Invoice | No | A clickable link to the source Sales Invoice being credited. |
| Credit Note Date | Yes | The date the credit is issued. Defaults to today. |
| Current Credit | No | The customer's available credit balance after this transaction. |
| Branch & Department | No | The unit and department responsible for the original sale. |
| Shipping Company | No | The carrier linked to the original transaction. |
Credit Items Table
Specify exactly what is being credited. Selecting only certain items or quantities produces a partial credit.
| Column | Description |
|---|---|
| Item Code & Description | Product details carried over from the invoice. |
| Sales Agents | The agent who originally handled the sale. |
| Invoiced Quantity | The total quantity billed on the original invoice. |
| Credited Quantity | Whether any of this item has already been credited previously. |
| Credit Quantity | The critical editable field. The quantity to credit now. It cannot exceed the remaining invoiced amount. |
| Price & Discount | The unit price and discount rate used on the original invoice. |
| Total | The value being credited for the line. |
Credit Totals Section
The final financial impact of the credit note. For partial credits the system prorates the shipping cost, discount and round off amounts against the quantities selected.
Credit Note Type & Inventory Handling
This is the decision that determines what happens to the physical goods.
| Field | Description |
|---|---|
| Credit Note Type | Choose Items Returned to Inventory Location to add the items back into stock, or a different type where the goods are damaged or not coming back. |
| Items Returned to Location | The warehouse the returned stock should be placed into. |
| Bank Account | For an immediate cash refund, the bank or cash account to pay from. Choose No Cash Return to leave the credit on the customer's account for future use. |
Get the Credit Note Type right first time. Returning damaged goods to a sellable location inflates your stock with items you cannot sell, and the correction means voiding the credit note and re-issuing it.
Memo & Attachments
- Memo — record the reason for the credit, for example "Goods damaged during transit".
- Choose File — attach photographs of returned goods or a signed return authorisation.
Action Buttons
| Button | What it does |
|---|---|
| Update | Saves the current details without finalising the credit. |
| Process Credit Note | Finalises the transaction, updates the customer ledger, and adjusts inventory if items are being returned. |
General Ledger (GL) Impact
Processing a Credit Note reverses the original sales entry.
| Account | Effect |
|---|---|
| Sales Revenue | Debited, reducing the income recorded. |
| Accounts Receivable | Credited, reducing what the customer owes. |
| Inventory & COGS | Where items return to stock, inventory value increases and cost of goods sold is reduced. |
Notes
You can split a single invoice into multiple credit notes. On a partial return the system calculates prorated Shipping Cost, Discount and Round Off amounts from the selected quantities, and you keep full control to adjust them to match the refund actually agreed with your customer.
Related pages
- Sales Invoice View — the invoice being credited
- Invoices — find the invoice
- Customer Credit Note and Sales Return — credit without an invoice
- View Sales Credit Note — the resulting document
- Allocations — apply the credit to invoices