Credit notes & refunds
Credit notes and refunds both return value to the customer, but they answer different questions:
| Credit note | Refund | |
|---|---|---|
| What it does | Reduces what the customer owes on an invoice | Returns money already paid to the customer |
| Use when | Goods were returned, price was wrong, a discount was forgotten — on an unpaid or partly paid invoice | The invoice was overpaid or fully paid and the surplus/amount should be paid back |
| Effect on the invoice | Marks it fully/partially credit noted; the amount still owed decreases | Records a negative transaction; the overpaid balance decreases |
Creating one
- Open the invoice and expand its Credit Notes panel → Add credit note, or use the Add Credit Note / Add Refund buttons on Invoicing › Credit notes.
- The dialog asks Credit note or Refund — pick what you need (the dialog also explains the difference).
- Choose a template:
- Pre-filled invoice items — the lines start as the invoice's not-yet-credited quantities, or
- Empty credit note — you add the lines yourself.
- The credit note editor opens with its own number (or refund ID), the original invoice reference, the customer, and editable lines — exactly like invoice lines (quantity, price, discount, VAT). You can also add lines that weren't on the original invoice.
- In the Transaction section choose the payment type — for refunds any payment method (how the money leaves), for credit notes deduction from invoice total — and the date.
- Update to save, then Send Credit Note / Send Refund (e-mail, SMS, WhatsApp, download or print) if the customer should receive a copy.
Effects
- The invoice's status flags update (credit noted / refunded) and the invoice list's Total refunded column shows credit notes + refunds.
- The Credit Notes list page shows every credit note and refund with its type, linked invoices, status and total (with a grand-total footer).
- Existing credit notes can be edited, printed, downloaded as PDF or deleted from that list.
Prefer a credit note when the customer still owes something — it reduces their debt. Use a refund only to pay money back that they actually transferred. If a paid invoice is being fully reversed, you typically issue a credit note and then refund the balance.