Credit Notes
Credit notes let you issue a full or partial refund against a sent invoice. They follow the same compliance rules as invoices — once sent, they are frozen and cannot be modified.
When to Use a Credit Note
- Overcharged a client — Issue a partial credit for the difference.
- Cancelled work — Refund activities that were invoiced but not performed.
- Invoice error — Correct a mistake on a sent invoice that cannot be edited.
- Client dispute — Issue a credit as part of resolving a billing dispute.
Before You Begin
- You need the Organization Admin role to create credit notes.
- The invoice must have been sent (not still in draft).
- The credit amount cannot exceed the invoice total minus any existing credit notes.
Creating a Credit Note
- Navigate to the invoice detail page for the invoice you want to credit.
- Click the Create Credit Note button.
- You will be taken to the credit note creation page.
Credit Type
Choose the type of credit:
- Full Credit — Refund the entire invoice amount. Line items are pre-populated from the original invoice.
- Partial Credit — Specify custom line items for the portion you want to refund.
Required Fields
- Reason (required) — Why the credit note is being issued. This is required for audit compliance.
Line Items (Partial Credit)
For partial credits, add one or more line items:
- Description — What is being credited.
- Quantity — Number of units.
- Unit Price — Price per unit.
Each line item can have its own VAT settings:
- VAT Percentage — Override the default VAT rate per line.
- Exclude from VAT — Mark a line as excluded from VAT.
- Tax Category — Set a Peppol tax category if applicable.
VAT Settings
VAT settings are inherited from the original invoice by default:
- Apply VAT — Whether VAT applies (inherited from the invoice).
- VAT Percentage — The default rate (inherited from the invoice).
Notes
- Notes (optional) — Additional notes that appear on the credit note PDF.
Credit note creation form
- Click Save to create the credit note as a Draft.
Sending a Credit Note
From the credit note detail page, click Send to deliver the credit note:
- A credit note number is assigned automatically (e.g., CN-00001).
- All values are frozen for compliance.
- The credit note is sent via Peppol or email, same as invoices.
- Status changes to Sent.
Credit Note Statuses
| Status | Description |
|---|---|
| Draft | Being prepared — fully editable |
| Sent | Sent to the client — frozen |
| Delivered | Delivery confirmed |
| Cancelled | Credit note cancelled |
Remaining Credit
FlowForth tracks how much credit has been issued against each invoice. On the invoice detail page, you can see:
- Invoice total — The original invoice amount.
- Total credited — Sum of all sent credit notes.
- Remaining credit — How much more can be credited.
You cannot create a credit note that would exceed the remaining credit available.
What's Next?
- Credit Note Details — Managing individual credit notes.
- Invoice Details — View the original invoice.
- Invoice Journal — Credit notes appear in the tax journal.
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