Credit Notes
A credit note records an amount you owe back to a contact — for example, a refund, a returned item, or a billing correction. In BusinessHRM a credit note is always created from an existing invoice, and the credit it holds can be applied to that contact's other outstanding invoices.
Credit notes are part of the invoices module, so this menu item appears if your company has the invoices module enabled and your role has view access to invoices. You start a credit note from a paid or partially paid invoice using its Add Credit Note action.
How to create a credit note
- Open the invoice you want to credit (it must be Paid or Partial).
- Choose Add Credit Note from the invoice's actions.
- The credit note opens pre-filled from that invoice — the contact, project and line items are already populated.
- Set the Credit Note Date (required) and an optional Due Date.
- Confirm the Currency (defaults to the invoice's currency).
- Adjust the line items — change quantities, unit prices, taxes, or remove items so the credit reflects exactly what you're crediting.
- Set a Discount and an Adjustment Amount if needed.
- Add a Note.
- Save.
The Credit Note Number is generated automatically using your prefix and numbering settings. The contact and project come from the source invoice and can't be changed.
Credit note fields
| Field | Meaning | Required |
|---|---|---|
| Contact / Project | Inherited from the source invoice | — (display only) |
| Credit Note # | Auto-generated reference | — (read-only) |
| Credit Note Date | The issue date | Yes |
| Due Date | Optional due date | No |
| Currency | Currency of the credit note | No (defaults to invoice currency) |
| Line items | Item, quantity, unit price, tax, amount | At least one |
| Discount | Percentage or fixed amount (cannot exceed subtotal) | No |
| Adjustment Amount | A manual adjustment to the total | No |
| Note | Free-text note | No |
What happens to the source invoice
When you save a credit note, BusinessHRM flags the source invoice as credited and adjusts its balance:
- If the credit covers the remaining balance, the invoice becomes Paid and the credit note may be marked Closed immediately.
- If it only covers part, the invoice becomes Partial.
Credit note statuses
| Status | Meaning |
|---|---|
| Open | The credit note still has credit available to apply. |
| Closed | The full credit has been used. |
A credit note automatically becomes Closed when all of its credit has been applied, and reopens to Open if an applied credit is later removed.
Applying credit to other invoices
While a credit note is Open, use the Apply to Invoice action:
- From the credit note's detail page, choose Apply to Invoice.
- BusinessHRM lists the contact's unpaid or partial invoices in the same currency that don't already have a credit note.
- Enter an Amount to Credit for each invoice (capped at the smaller of the remaining credit and the invoice's balance).
- A running total shows how much you're applying and how much credit remains.
- Apply the credit. Each applied amount is recorded against the chosen invoice and moves it toward Partial or Paid.
Credit can only be applied to invoices in the same currency as the credit note.
Reversing an applied credit
The Credited Invoices view lists where this credit note's credit has been applied. Removing an entry there restores the affected invoice's balance and status and reopens the credit note.
Other actions
| Action | Notes |
|---|---|
| Download | Downloads the credit note as a PDF (or the uploaded file if one was attached). |
| View Invoice | Opens the source invoice. |
| Edit | Edit the credit note. |
| Delete | Available only for the most recent credit note; deleting it also reverses any applied credit. |
| Attach file | Upload an external credit-note file to use in place of the generated PDF. |
The credit note detail also shows the Credit Amount Used and Credit Amount Remaining.
Permissions
Credit notes reuse the invoice permissions:
- View invoices — see and download credit notes.
- Add invoices — create credit notes.
- Edit invoices — edit credit notes.
- Delete invoices — delete credit notes.
Tips
- Trim the line items so the credit note shows exactly what you're refunding or correcting — it doesn't have to mirror the whole invoice.
- Use Apply to Invoice to put a credit toward a contact's next bill instead of issuing a cash refund.
- Remember credit only applies within a single currency — credits from a USD invoice can't be applied to a EUR invoice.