Credit Invoices

A credit invoice is the document you issue when you need to refund a customer or correct the amount on a previously issued invoice. Instead of altering or removing the original invoice, you create a new document that offsets it — fully or partially — and keeps your accounting records intact.

When to Use a Credit Invoice

The most common situation is a refund: a product or service did not meet the customer’s expectations, and you need to return some or all of the money they paid. Other typical cases include correcting a billing error, applying a discount after the fact, or cancelling an order that was already invoiced.

Why Not Just Delete the Original?

Once an invoice has been sent to a customer — and especially once it has been recorded in your accounting — you generally cannot delete it. Doing so would break the sequential numbering required for accounting and leave a gap in your records that auditors and tax authorities expect to be continuous.

This is even more important for partial refunds. If you only need to return part of the original amount, deleting the invoice is not an option at all — the original transaction still happened, and only the difference needs to be reversed. A credit invoice records exactly that: the amount being credited back, leaving the original invoice untouched.