> ## Documentation Index
> Fetch the complete documentation index at: https://docs.pluvel.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Credit Notes

> Issue credits and refunds to customers when things need adjusting.

Customer overpaid? Delivered less than you billed? Need to refund a retainer? Credit notes handle the money flowing the other direction — from you back to the customer.

## When to Use Credit Notes

Common situations:

* **Refunds** — Customer paid but wants their money back
* **Overpayment** — Customer paid $1,000 when the invoice was $800
* **Partial delivery** — You billed for 10 hours but only delivered 8
* **Goodwill adjustment** — Knocking money off because something went wrong
* **Price correction** — You invoiced at the wrong rate

Credit notes create a formal record of the adjustment. Better than just editing the original invoice (which you shouldn't do once it's been sent).

## Creating a Credit Note

Go to **Finance → Invoicing → Credit Notes** and click **New Credit Note**.

You can:

**Create from an invoice** — Select the invoice you're crediting. Line items pull in automatically. Adjust amounts or quantities as needed.

**Create standalone** — For credits not tied to a specific invoice (goodwill, prepayment refunds).

Either way, specify:

* Customer
* Line items (what's being credited)
* Amount
* Reason (internal note for your records)

## Applying Credit Notes

Once created, a credit note can be:

**Applied to an invoice** — Customer has an unpaid invoice? Apply the credit and reduce what they owe.

**Refunded** — Pay the customer back directly. Pluvel records the payment going out.

**Left as credit** — Sits on the customer's account as a future credit. They can apply it to their next invoice.

To apply a credit note:

1. Open the credit note
2. Click **Apply**
3. Select an unpaid invoice
4. Confirm

The invoice balance updates automatically.

## Example: Partial Refund

You invoiced Acme Corp $5,000 for consulting. They paid in full. Later, you agree the scope was smaller than planned — you owe them $800 back.

1. Create a credit note for \$800
2. Reference the original invoice
3. Choose **Refund**
4. Record the payment (check, transfer, however you're paying them)

Your books show: $5,000 revenue from original invoice, $800 credit note, net \$4,200 recognized.

## Credit Notes vs. Voiding Invoices

| Scenario                                     | What to Do                                                      |
| -------------------------------------------- | --------------------------------------------------------------- |
| Invoice sent in error, customer never saw it | Void the invoice                                                |
| Invoice paid, now needs adjustment           | Issue a credit note                                             |
| Invoice sent but not paid, customer disputes | Depends — void if it's completely wrong, credit note if partial |

Voiding removes the invoice from your books like it never happened. Credit notes keep the original invoice and create an offsetting record.

Once an invoice is paid, never void it. Use a credit note.

## Viewing Credit Notes

Your credit note list shows:

| Status   | Meaning                                   |
| -------- | ----------------------------------------- |
| Draft    | Created but not finalized                 |
| Open     | Issued, waiting to be applied or refunded |
| Applied  | Used against an invoice                   |
| Refunded | Money paid back to customer               |

Filter by status or customer to find what you need.

## Reporting

Credit notes affect your reports:

* **Revenue** — Credit notes reduce revenue in the period issued
* **Accounts Receivable** — Applied credits reduce AR balance
* **Cash Flow** — Refunded credits show as cash outflow

You can see credit notes in the **Sales → Credit Notes** report, or they'll appear on customer statements.

## Tips

**Be specific about the reason.** "Refund" isn't helpful. "Refund for hours not used in March project" tells you something when you look back.

**Don't over-use credit notes.** If you're issuing a lot of them, you might have a quoting or scoping problem. Fix the root cause.

**Apply promptly.** Unapplied credit notes sitting around cause confusion. If you owe someone money, deal with it.

<Warning>
  Credit notes affect your taxable income. If you're refunding something you already reported as revenue, the credit note reduces that revenue. Make sure your timing is correct, especially around year-end.
</Warning>

<CardGroup cols={2}>
  <Card title="Creating invoices" icon="file-invoice" href="/features/invoicing/creating-invoices">
    Create the invoices that credit notes reference.
  </Card>

  <Card title="Customer management" icon="users" href="/features/invoicing/customers">
    View a customer's full transaction history including credits.
  </Card>
</CardGroup>