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Credit Note Generator

Correct or cancel an invoice properly with a numbered credit note that references the original.

A credit note cancels all or part of an invoice you have already issued, instead of deleting or editing it, so your numbering stays unbroken and your VAT records reconcile. It must carry its own number, the date, your details, the customer’s details, the original invoice number, the reason, the amounts credited and the VAT at 20% being reversed.

Your details

Sole traders must show their own name and business address. If you are VAT registered, add your VAT number: the VAT breakdown is shown automatically. Saved in this browser and reused across all five document tools.

Only if you are VAT registered.

Limited companies must show this.

Resized to 400px wide and kept under 150 KB. Stored in this browser only; not included in share links.

Client details

The last five are remembered when you download, so you can pick them next time.

Document details

Auto-increments when you download. Next new document: INV-0001.

Line items

Prices are net of VAT. Choose the VAT rate per line; 0% also covers exempt items and businesses that are not VAT registered.

  1. £

    Line total £0.00

Discount

Applied across every line before VAT, so each VAT rate is charged on the discounted amount.

%

Notes and terms

Bank details

Saved with your business details. Shown on the document so clients can pay by transfer.

Template

Choose a template
Subtotal
£0.00
VAT @ 20%
£0.00
Total
£0.00
CREDIT NOTE
Bill to
Date
Credit against
Invoice (invoice number)
Description
Qty
Unit price
VAT
Total
No items yet. Add a line on the left.
Subtotal
£0.00
VAT @ 20% on £0.00
£0.00
Total credit
£0.00
Made with SoleKit

Free, no signup. Everything stays in your browser.

Source: GOV.UK: Invoicing and taking payment from customers. Last updated .

How to use the credit note generator

When should I issue a credit note?

  • The customer returns goods or you did not complete part of the work
  • You overcharged, charged the wrong VAT rate or sent the invoice to the wrong customer
  • You agreed a discount after the invoice went out
  • The invoice is cancelled entirely

Never delete an issued invoice. HMRC expects an unbroken sequence, and a missing number looks like hidden income. A credit note reverses the invoice in the records while leaving the trail intact. If the customer has already paid, the credit note is the document that supports the refund or the deduction from their next invoice.

What must a credit note include?

  • The words “credit note” and a unique number in its own sequence, for example CN-0001
  • The date of issue
  • Your name, address and VAT number if registered; limited companies use the full registered name
  • The customer’s name and address
  • The number and date of the invoice being corrected
  • The reason for the credit
  • Each item credited with quantity, unit price and VAT rate
  • The net amount, the VAT amount and the total credited

For VAT-registered businesses the VAT on the credit note reduces the output VAT on your next return, and the customer reduces their input VAT by the same figure, so the VAT rate must match the original invoice.

What does a worked example look like?

Invoice INV-0042 charged £750.00 plus VAT, £900.00 in total. The customer returns £150.00 of unused materials:

Credit note CN-0003 against INV-0042
LineAmount
Materials returned, net£150.00
VAT at 20% reversed£30.00
Total credited£180.00
Original invoice total£900.00
Amount now due on INV-0042£720.00

How do I use the credit note generator?

  1. Enter the original invoice number and date; the generator pulls your saved business details.
  2. Add the lines being credited, or press “Credit the whole invoice” to copy every line.
  3. Give the reason, choose a template and download the PDF.
  4. Send it to the customer and record it in your books against the original invoice.

If money is going back to the customer, issue a receipt for the refund so both sides have a record. For a change to a quote that has not been invoiced yet, simply issue a revised quote; credit notes are only for invoices.

Frequently asked questions

Can I just edit or delete the wrong invoice instead?
Not once it has been sent. Editing it leaves the customer with a different copy from yours, and deleting it breaks the invoice sequence HMRC expects to see. Issue a credit note for the wrong invoice and, if needed, a fresh invoice with the right details.
Does a credit note have to show VAT?
If the original invoice showed VAT, yes, at the same rate. The credit note reduces the VAT you have declared, so the figure must be visible for both your records and the customer’s. If you are not VAT-registered, no VAT line appears.
Do credit notes need their own numbering?
Yes, keep a separate unbroken sequence such as CN-0001, CN-0002. Each credit note should also quote the invoice number it corrects. The generator tracks the next number for you in your browser.
Can a credit note be for more than the invoice?
No. A credit note can only reverse what was charged on the invoice it refers to. If you owe the customer more, for example compensation for damage, agree that separately and pay it as a refund with its own paperwork.
What if the customer has already paid the invoice?
You can refund the credited amount or hold it as a credit against their next invoice; say which on the credit note. Either way the credit note is the document that supports the adjustment in both sets of books. Refund by the same method the customer paid where you can.

Related tools

Read next

  • What must a UK invoice legally include?The details every UK invoice must show, the extra items a VAT invoice needs, and what sole traders and limited companies must add.
  • How to chase late paymentsA tested sequence for chasing an overdue invoice, from the friendly reminder to statutory interest, a letter before action and small claims.

Cite this page: “Credit Note Generator”, SoleKit, https://solekit.co.uk/credit-note-generator