Credit Note

What are credits?

Credits in Zoho Books represent the money that you owe your customer. A credit note is issued in the customer’s name in order to keep track of this debt until it’s paid off. The debt remains until it’s refunded or subtracted from the next invoice you send your customer.

To know how you as a customer can record the credit you receive from your vendors in Zoho Books, click here

Creating a credit note

The simplest way to create a credit note in Zoho Books is,

Or, you can create a credit note directly from an invoice in the name of the customer you want to issue those credits for. To do this,

Creating a credit note

Credit notes can also be created by selecting a customer from the Contacts tab. Select New transaction - Credit Note and proceed to create the credit note.

New credit note

You can view and edit these anytime by scrolling down the Sales tab to view Credit Notes. Clicking on the pencil icon highlighted below lets you edit the credit recorded.

Editing a credit note

Mandatory fields

You will need to enter the following information while recording Credit Notes.

Closing a credit note

By applying to invoice

Credits you issue a customer can be applied to an invoice raised for the same customer. Doing so will reduce the invoice amount accordingly. To do this,

Applying credits to invoice

This can also be done by opening the corresponding invoice and selecting Use credits. Or, simply click on the update on the invoice telling you there are credits available for that customer.

Use credits

With a refund

If you’ve made a direct payment to your customer towards the amount owed to him, you can record this in Zoho Books against the corresponding credit note created. To do this,

Recording a refund

The payment recorded can be deleted by scrolling down till you see the Refund history. Click on the trash icon next to the recorded payment to delete the payment. The credit note status is changed to Open.

Deleting the payment

Tracking Inventory

If you have enabled inventory for your organization and raise a credit note towards items returned by your customer, your stock quantity will automatically be adjusted accordingly.

This is handy for scenarios where your customers return some items back to you and you need to account for this in Zoho Books. While recording the credit you offer your customer in place of the returned goods, simply specify the item quantity and this will automatically be adjusted in your Zoho Books items list.

Learn more about inventory here.

Other actions{(#other-credit-actions}

Other actions

Filtering Credit Notes

Custom Views

Custom Views are specific filters to list your credit notes based on your criteria.

For example, out of all your credit notes in Zoho Books, you might want to view those credit notes that are greater than $1000.

With Custom Views, you can simply create this filter. All you have to do is set criteria and later use it to classify data.

You can find an example GIF image to understand how custom views work.

Custom view of invoices

To create a Custom View:

Your new custom field will now be listed under Created By Me, in the dropdown.

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