Sales
Create a credit note
Reduce what a customer owes after an invoice: select the invoice, adjust quantities, give a reason, then submit for approval so receivables update.
Updated 12 September 2026
A credit note reduces the amount a customer owes. Use it for returned goods, billing corrections and discounts agreed after the invoice was issued. It is always raised against an existing sales invoice. You cannot create a credit note without one.
This is the right way to correct an approved invoice. You do not edit the invoice, because the original has to stay intact for audit. You issue a credit note against it.
Open the form
- Go to the left navigation panel.
- Click Sales.
- Open Credit Note.
- Click New Credit Note.
Reference details
- Select Customer, required.
- Sales Invoice ID, required.
- Date.
- Reference.
- Reason, required.
When you select the invoice, all its items load into the table with product details, rates and totals filled in. The credit note is also linked to that invoice. The reason is required because it explains the change to an auditor later. Write what actually happened, for example “goods returned damaged” or “quantity over-billed”. The word “correction” alone is not enough.
Adjust the items
The table holds the serial number, product name, quantity, rate per item, discount and total.
Only the quantity can be edited. Rate and product details are controlled by the invoice, and the discount is inherited from the invoice settings. Totals update as you change quantities. Remove any line that is not part of the credit, so the note covers only what is actually going back.
Totals
The summary calculates the subtotal, discount, taxable total, non-taxable total, VAT total and total amount. Item-level discounts from the invoice lines and an overall credit note discount are calculated separately and combined in the totals.
Save it
- Cancel exits the page.
- Save as Draft keeps it editable with no effect on your records.
- Save Credit Note creates it, moves it to Pending and starts the approval workflow.
What approval does
Draft and pending credit notes have no financial effect. On approval, the customer’s outstanding balance is reduced, the invoice value is adjusted, and your receivables and reports update. After approval the record is read-only. Depending on your permissions, you can still duplicate it.
Void removes a credit note from financial calculations, requires a reason, and leaves the record for audit.