Credit Notes

A credit note is a document you issue to a customer to reduce or reverse an amount they owe on a previous invoice. Use credit notes when:

• A customer returns a product
• You need to correct an overcharge on a paid or unpaid invoice
• You want to write off part or all of an outstanding balance
• You agreed to a discount after the original invoice was issued
• You need to document a refund you processed outside of Invotify

Why credit notes matter: Credit notes are the accountant-approved way to adjust an invoice after it's been issued. They don't rewrite history — the original invoice stays exactly as it was — they simply document the correction on its own record with its own number and date. This keeps your books audit-ready and your customer's statement clear.

Credit notes vs. editing invoices: If an invoice is still in draft, you can edit it directly. Once an invoice has been sent or marked paid, it's part of your financial record — you should issue a credit note rather than modify it. Invotify lets you do either, but credit notes are the recommended path for sent or paid invoices.

Credit notes in Invotify are created from an existing invoice — this keeps every credit tied to the document it corrects. You start from the Credit Notes page, pick the invoice, and the rest auto-fills.

Creating a credit note: 1. Go to the Credit Notes page 2. Click "New credit note" 3. Pick the invoice you want to credit 4. Its line items load with the quantity still available to credit on each row 5. Tick the lines to include — all of them for a full credit, or specific ones for a partial credit 6. Adjust the credited quantity per line if you're only crediting part of an item 7. Add a reason and any notes (strongly recommended for audit trails) 8. Save as draft, then issue it when you're ready

The customer, currency, and tax details come from the invoice automatically. You cannot credit more than what remains uncredited on each line — Invotify blocks over-crediting.

The credit note PDF: Each credit note produces a clean, standard PDF clearly headed "CREDIT NOTE" so there's no confusion with an invoice. It lists the credited lines, the total credit, and your business details, and carries the reason you entered.

Credit notes move through four statuses from creation to settlement. Understanding them helps you track which credits are live and which are merely drafted.

Because credit notes are created against an invoice, applying one is mostly automatic.

Applied to the linked invoice at issue time When you issue a credit note that is linked to an invoice, Invotify immediately reduces that invoice's outstanding balance by the credit amount. If the invoice was €1,000 and the credit note is for €400, the invoice now shows €600 due. If the credit equals or exceeds the outstanding amount, the invoice is marked as paid. You don't take a separate "apply" step — issuing is what applies it.

The "Applied" status is a manual marker Marking a credit note as Applied (from the Issued status) is a bookkeeping flag you set to record that the credit has been fully dealt with — for example, after a refund has cleared. It does not, by itself, change any invoice balance; the balance change already happened at issue.

Refunds are handled outside Invotify A credit note is a document, not a money movement. If you owe the customer cash back, process the refund through your usual channel — Stripe, a bank transfer, or cash — and mark the credit note as Applied once it has cleared. Invotify does not push refunds to a payment provider on your behalf.

Voiding reverses the balance change If you void a credit note that was linked to an invoice, Invotify restores that invoice's outstanding balance by the credited amount, so the invoice goes back to showing what is genuinely owed.