What it does
The Credit Note Generator issues a credit note when you refund or reduce an invoice: for returned goods, a pricing mistake, a cancelled service or a goodwill discount. It links the credit to the original invoice and shows the total credit.
How to use it
- Fill in From (you) and Credit to (the customer).
- Enter the Original invoice date and mention the invoice number under Reason.
- List what is being credited as line items, with the same tax rate as the original invoice.
- Under Credit terms, say whether it is refunded or set against the next invoice.
- Preview, then print or save as PDF.
Example
CREDIT NOTE CN-2026-003 Reason: Credit for items returned from invoice INV-2026-001. Returned: Hosting (3 months), 3 × 25.00 = 75.00, tax 8% = 6.00 Total credit: 81.00
Good to know
- Do not edit or delete an invoice you have already sent. Issuing a credit note keeps your records and tax returns correct.
- Use the same tax rate as the original invoice so the tax is reversed correctly.
- Credit notes are numbered in their own sequence (
CN-…).
FAQ
What is the difference between a credit note and a refund? The credit note is the document; a refund is one way of settling it. The credit can also be set against future invoices.
Is a credit memo the same thing? Yes. "Credit memo" is the usual US term.