Create a credit note

A credit note reduces what a customer owes on an invoice. Use it when goods come back, when you charged too much, or when you agree a discount after the sale. You can't cancel or change a sent invoice, so a credit note is how you correct one.

Each credit note belongs to one invoice. You can raise several against the same invoice, as long as the total never goes over the value of the invoice. A paid invoice can still be credited, for example when goods come back after payment.

Steps

1. Open Sales › Credit Notes

   In the menu on the left, select Sales, then Credit Notes. You see every credit note with its Credit Note #, Invoice #, Customer, Credit Note Date, Reversal Date, Status and Total Refund. Select New Credit Note.

   If you don't see New Credit Note, your role can't create credit notes. Ask your administrator.

   If there are no credit notes yet, the list says No credit notes yet. If you have chosen a customer or dates and nothing matches, it says No credit notes match these filters: change or clear the filters.

   You can also start from the invoice. In Sales › Invoices, open the actions menu (⋮) on the invoice and select Create Credit Note. Or open the invoice with Edit and select Credit Note at the bottom. In both cases a New Credit Note window asks for the Reversal Date and the Reason for Reversal. Select Reverse and go to step 3.

   

   1. Credit Notes in the Sales menu.
   2. New Credit Note.
2. Choose the invoice

   The New Credit Note panel opens on the right.

   • Select Invoice: the invoice you're crediting. Type an invoice number or a customer name to search. Required. Only invoices with value left to credit are listed, including paid ones.
   • Reason for Reversal: why you're raising the credit note, for example Three units returned damaged. It's saved with the credit note.
   • Reversal Date: the date the credit note posts on. It starts on today. Required.

   Select Create Credit Note. The credit note form opens with the invoice's lines filled in.

   

   1. Select Invoice.
   2. Reason for Reversal.
   3. Reversal Date.
   4. Create Credit Note opens the full form.
3. Check what was credited before

   At the top you see the Customer Name, the Invoice Number and the Reversal Date. The Credit Note Number says Auto-generated upon creation: the number is given when you save.

   If the invoice already has credit notes, Previous Credit Notes lists each one with its Number, Date, Reason, Amount and Status, and how much has already been credited.

4. Set what you're crediting on each line

   In Line Items, every invoice line starts fully credited. Change each line to match what you're giving back.

   • Credited Qty: how many units you're crediting. It can't be more than the Original Qty. Set it to 0 to leave a line out.
   • Unit Price: the amount you're crediting per unit. Lower it to credit only part of the price, for example for a price adjustment.
   • Returned Qty: how many units are coming back into stock. Only stock items can be returned. Other lines show N/A.
   • Reason: why this line is credited. See the list below.
   • Line Total works itself out.

   Tax is copied from the invoice and can't be changed here.

   To split one invoice line, for example to return some units and reprice the rest, select the copy button (Add another credit for this line) in Actions. A new row for the same line appears. Give each row its own quantity, price and reason. To remove a row you don't need, select its delete button.

   If the invoice line sold serial numbers, you also say which units are coming back. When you enter a Returned Qty, Choose serial numbers appears under it.

   

   1. Credited Qty: how many units you're crediting.
   2. Returned Qty and the serial numbers coming back. Returning the whole line picks all its serial numbers for you; select Change serial numbers to pick others.

   1. Select Choose serial numbers. A Serial numbers window opens with the item's name in its title.
   2. Under Sold on this invoice line, tick one serial number for each unit coming back. Only the numbers this invoice line sold are listed, and you can't type others.
   3. Select Use these serial numbers. You can only select it when you have chosen exactly as many as the Returned Qty, or none.

   

   1. Sold on this invoice line: tick one serial number for each returned unit.
   2. Use these serial numbers confirms your choice.

   If you return the whole line, all its serial numbers are chosen for you. If you change the Returned Qty, choose the serial numbers again. A serial number that is already back on another issued credit note can't be returned twice. When the credit note is issued, those units go back into stock; if you later cancel it, they come out of stock again.

   For a project invoice, each line is credited in full at the invoiced quantity and price. Remove the lines you don't want to credit.

   

   1. Credited Qty.
   2. Reason.
   3. Unit Price.
5. Choose a reason for each line

   Pick the Reason that fits each line. The reason is recorded on the line and on its ledger entry. It doesn't change the account: the line always reverses into the invoice line's revenue account (see Set up credit note reason accounts).

   • Auto (based on quantity): WbizManager decides for you. A line with a returned quantity counts as a physical return; any other line counts as a price adjustment.
   • Physical Return: the customer sent the goods back. Stock can come back.
   • Damaged on Arrival: the goods arrived damaged and came back. Stock can come back.
   • Short Shipment: you delivered fewer than you billed.
   • Over-billing: you billed more than was agreed.
   • Cancellation: the order, or part of it, was cancelled.
   • Price Adjustment: you've agreed a lower price after the sale.
   • Retrospective Discount: a discount agreed after the invoice was sent.
   • Rebate: a rebate the customer has earned.
   • Billing Error: the invoice was wrong.
   • Goodwill: credit given as a goodwill gesture.

   Only Physical Return and Damaged on Arrival bring stock back. If you pick any other reason, Returned Qty goes back to 0.

6. Check the reason and the totals

   Reason for Reversal shows what you typed in the panel. Change it if you need to.

   Check the totals on the right: Subtotal, any discount and tax, and Total Refund. Below them:

   • Balance Due is what the customer still owes on the invoice. It can be 0 on a paid invoice.
   • Available to Credit is the most this credit note can be. The Total Refund can't go over it.

   

   1. Total Refund.
   2. Balance Due and Available to Credit.
7. Preview the credit note (optional)

   Select Preview Credit Note to see the credit note as the customer will receive it. Close the preview to keep editing.

8. Save as a draft, or save and send

   Select Save and Send at the bottom right. Two options open below it. Choose one.

   • Save as Draft keeps the credit note as a Draft. Nothing is posted and the invoice balance doesn't change. Post it later from the list.
   • Save and Send issues the credit note straight away and opens the Send Credit Note window.

   You're taken back to your invoice list once it's saved.

   

   1. Save and Send.
   2. Save as Draft.
9. Send it to the customer

   If you chose Save and Send, the Send Credit Note window opens.

   • Send Email: leave it on to email the customer. Turn it off to issue the credit note without emailing it.
   • To: the customer's email address. Add more people in Additional Emails, separated by commas.
   • Subject and Message Body: check the wording.
   • Attach as PDF: leave it ticked so the customer gets a copy.

   Select Send. You'll see Credit note … created and sent successfully, or created and issued successfully if you didn't email it. The credit note is now Issued.

   

   1. To: the customer's email.
   2. Send.

What issuing a credit note does

When a credit note is issued, WbizManager:

• takes the credit off the invoice's balance due. On a paid invoice, the customer is left in credit with you;
• reverses the sale in your ledger on the Reversal Date, at the invoice's own exchange rate: the sales revenue and tax the invoice posted, and the customer's receivable;
• for units returned to stock, puts the goods back into inventory at the cost they left at, and reverses their cost of goods sold;
• changes the invoice's status to CREDITED in the list when credit notes bring its balance to zero.

Post a draft credit note

1. In Sales › Credit Notes, open the actions menu (⋮) on the draft and select Post.
2. In the Post Credit Note window, select Post.

You'll see Credit note issued successfully and the status changes to Issued. Posting can't be undone, only cancelled. You see Post only if your role can approve credit notes.

Cancel a credit note

1. In Sales › Credit Notes, open the actions menu (⋮) on the credit note and select Cancel.
2. In the Cancel Credit Note window, type a Reason for Cancellation (Optional).
3. Select Yes, Cancel It.

You'll see Credit note cancelled successfully and the status changes to Cancelled. Cancelling an issued credit note posts entries that undo it, puts the amount back on the invoice and takes any returned stock out again. A cancelled credit note can't be used again.

To see a credit note's lines and totals at any time, open the actions menu (⋮) and select View.

If something goes wrong

Message	What to do
Please select an invoice	Choose the invoice in Select Invoice.
Reversal date is required	Pick a date in Reversal Date.
No eligible invoices found.	No sent invoice has value left to credit. A draft invoice must be sent first.
Cannot create credit note for a draft invoice. Invoice must be sent first.	Send the invoice, then credit it.
This invoice has already been credited in full, so there is no value left to credit.	Nothing is left to credit on this invoice. Check Previous Credit Notes.
At least one line item must have a quantity greater than 0	Enter a Credited Qty on at least one line.
Credited quantity (…) cannot exceed original quantity (…)	Lower Credited Qty to no more than Original Qty.
Returned quantity (…) cannot exceed credited quantity (…)	Lower Returned Qty, or raise Credited Qty.
'…' is credited as …, which does not return goods to stock.	Set Returned Qty to 0, or change the Reason to Physical Return or Damaged on Arrival.
Choose the … serial number(s) coming back for '…'.	Pick one serial number for each returned unit.
Serial number … of … has already come back on another credit note.	That unit was already returned. Untick it and choose another.
Serial number … was not sold on this invoice line (…).	Choose only the serial numbers listed under Sold on this invoice line.
No invoice chosen	You opened the credit note form without picking an invoice. Select Back to Invoices and start again from the invoice, or use New Credit Note on the list.
The invoice could not be loaded	Select Try again. If it keeps happening, select Back to Invoices and start again.
This could not be loaded (on the Credit Notes list)	The list didn't load. Select Try again. If you see You do not have access to this, ask an administrator for the permission.
This credit note has more than one identical line for the same invoice item …	Give split rows a different Reason or Unit Price, or remove the extra row.
Credit note total (…) cannot exceed the amount available to credit (…)	Lower the quantities or prices until Total Refund is within Available to Credit.
This credit note is already awaiting approval.	Wait for the approver to decide.
No approval workflow is configured for this document type. Contact your administrator.	Your company approves credit notes, but no approval workflow has been set up for them, so they can't be sent or posted yet. Select Save as Draft to keep your work, and ask your administrator to set up the credit note approval workflow.