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Credit Note is created to handle returns, invoice credit and customer credit. It can be created from an invoice to credit the invoice value and return products to the inventory or can be created directly to credit back an amount to the customer.

Credit an Invoice

Use the Customer Transaction Inquiry screen to select an invoice you want to credit.

  • Locate the invoice you need to credit.
  • Click the blue arrow link at the end of invoice row say “Credit This”
  • Use Credit Quantity field to set right quantity per item.
  • Credit Note Type field can be set to:
    • Items Returned to Inventory Location
    • Items Written Off
  • Write your comments and notes, maybe the reason of credit.
  • Then Process the document.
  • Please note if the invoice is not Cash, then the money will not be returned to the customer and should be done separetelly using customer payment.

Free Customer Credit Note

Enter each line item, quantity and price. If the material is to be returned to stock, select the correct option from the Credit Note Type combo-box and location/warehouse it is being been returned to. Otherwise (Items Written Off), if the items are NOT going to be returned to stock (credit only) select the GL Account to be adjusted.


If some items will be returned to stock, but others won’t, they will need to be on separate credit notes.

To issue a refund to a customer:

  1. Create the credit note as above
  2. Banking and General Ledger->Payments
  3. Select the bank account, customer to issue to the payment, and the amount of the credit.
  4. Sales->Allocate Customer Payments or Credit Notes
  5. Allocate the payment to the credit note