Create a sales credit note
If you provide a customer with a credit note, for example, because they’ve returned faulty goods, you can create this from the original invoice. Alternatively, you can create a standalone credit note, and allocate this to any outstanding invoice at a later date. You can choose to print or email the credit note to the customer.
Before you can create the credit note, if you haven’t already done so, you need to create your customer records. If you supply your customers with the same products or services, to save time when entering your credit notes, you can also create records for these.
If required, you can customise the appearance of your credit notes, add your company logo and include your default terms and conditions.
- Go to Sales, then click Sales Invoices.
- Click the invoice you want to credit.
- From within the invoice click Add Credit Note.
The credit note appears with the details of the original invoice.
- If necessary, you can amend the details. For more information see the following section.
The credit note net and VAT totals appear at the bottom of the credit note. The credit note total can’t be more than the amount outstanding. To view a breakdown of the VAT amounts, click the Total VAT, then to return to the credit note, close the VAT Analysis window.
- If this is a draft credit note, select the Save as draft check box. You can return to the credit note at a later date when you’re ready to update the ledgers and clear this check box.
- If required, enter any notes. Then click Save.
You’ve successfully entered a credit note against the original sales invoice. If the credit note covers the full value of the invoice, the invoice status appears as Paid, otherwise the status appears as Part Paid.
- Point to Sales then click Sales Credit Notes.
- Click New Credit Note, then enter the following information:
|Name *||Enter the customer name. As you type, a list of customers appears. Simply choose the customer from the list.
Tip: To add a new customer, click in to the Search for a Customer box, then click Add a customer. Enter the relevant information, then click Save.
|Credit Date *||Enter the date of the credit note.|
|Reference||If required, enter a reference, for example, a customer return authorisation number.|
|Address *||If there’s a main address in the customer’s record, this appears automatically.
If there is no address on their record, click Add a main address then enter the address and click Update.
Note: This doesn’t update the address in the customer’s record.
|Delivery Address||By default, the delivery address is the same as the customer’s main address.
If you don’t want to use this address, click the edit button, then select whether you want to use the invoice address, no address or a custom one. If you selected Custom, you must enter the address. To save the changes you’ve made, click Update.
* These details are compulsory.
- To issue a credit note for a specific product or service, type the name of the item in the Product/Service box then choose the required item.
The information for the chosen product or service appears on the next available invoice line. If necessary, you can change this information, for example, the quantity or unit price. If you need to create a new product or service record, click Create Item.
- To add more products or services to the credit note, repeat the previous step.
- If you don’t want to add a product or service to the invoice, enter the following information:
|Description *||Enter a description for the credit. You can enter up to 2000 characters.|
|Ledger Account *||Choose the nominal code for the credit.|
|Item Code||If necessary, enter a code. For example, a part number or stock code.|
|Qty *||Enter the quantity of items sold.|
|Unit Price *||Enter the net value of the item.|
|Discount||If you want to enter a discount as a fixed amount, enter the value in the Amount box and leave the percentage as zero. If you want to enter a discount as a percentage, leave the value in the Amount box as zero and enter the percentage in the % box.|
|VAT Rate *||Choose the relevant VAT rate.
Tip: If your business is VAT registered and you don’t have the option to choose a VAT rate, check you’ve entered your VAT scheme correctly in Settings > Financial Settings.
|VAT Amount *||This calculates automatically based on the quantity, unit price and VAT rate.|
|Total||This is the total gross value of this item line.|
* These details are compulsory.
- If you’ve created transaction analysis types, for example departments, click the double chevrons button, then choose the relevant analysis category.
- If you’re issuing a credit note for goods or services to a customer in the EU, click the double chevrons button, then choose whether the item is Goods (and related services) or Services (standalone).
If the customer is VAT registered, you must also choose which EU sales description you want to appear on the credit note.
- If required, enter any notes and terms and conditions.
- To credit any postage charges, under Carriage, choose the relevant VAT rate and enter the net amount.
The overall net amount of the credit note and VAT total appear at the bottom of the credit note. To view a breakdown of the VAT calculated, click Total VAT, then to return to the credit note, close the VAT Analysis window.
- To save the credit note and close the window, click Save. Alternatively, you can do one of the following:
|To save the credit note as draft||Select the Save as draft check box, then click Save.
You should use this option if you’re not ready to send the credit note to your customer yet and you don’t want to update the ledgers. When you’re ready to issue the credit note, simply open the draft credit note, make any changes as necessary and clear the Save as draft check box, then click Save.
|To save the credit note and email it now||Click Save & Email. The Email Credit Note window appears.
If the customer has an email address in their record, it appears in the To box. You can enter additional email addresses separated by a semicolon.
To receive a copy of the credit note to your registered email address, select the Copy to me check box. The subject line by default contains the credit note number, value, and date, you can change this if you want. The default email message appears in the body of the email, you can also change this if you want.
To also print a copy of the credit note, select the Also print a copy of this credit note check box.
|To save the credit note and print it now||Click Save & Print. The credit note opens in a new window or tab and you can choose to save or print the credit note from your browser file menu.|
|To save this credit note and create another one||Click Save & New.|
You’ve successfully entered a credit note which you can allocate to an invoice.