Credit note
In Arabic الإشعار الدائن
A credit note is a document a seller issues to reduce what a customer owes on an earlier invoice, for returned goods, an overcharge or an agreed allowance.
In plain words
Once an invoice is issued it should not be changed. When the amount owed has to come down, a credit note does it instead, leaving the original invoice intact and a clear record of why the balance fell.
A credit note normally names the invoice it corrects, carries its own number and date, and reverses the VAT on the amount credited. Where e-invoicing applies, it is usually reported the same way as an invoice.
The common mistake is editing or cancelling the original invoice to show the lower amount. The audit trail breaks, the VAT already reported no longer matches, and nobody can tell what was first billed.
- Invoice total, VAT included
- SAR 1,150.00
- Credit note for returned goods
- SAR 230.00
- Paid so far
- SAR 500.00
- Still owed on the invoice
- SAR 420.00
In Axon Suite
How Axon Suite handles it
In Axon Suite a return settled by refund or store credit posts a credit note against the original invoice. If the customer has not paid yet, the credit note alone reduces what they owe on it.
Feature
Sales returns and credit notes
Raise the return against the original invoice, approve it and receive the goods back into the warehouse. Then decide what the customer gets: a refund, store credit or a replacement. A refund or store credit posts a credit note against that invoice.
Open: Sales returns and credit notes