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Credit Notenoun

A document reducing the amount a customer owes on a prior invoice.

A credit note is issued to a customer to cancel or reduce an invoice — for returns, overcharges or agreed adjustments. It is the formal opposite of an invoice.

Proper credit notes keep receivables and statements accurate and provide an audit trail for every adjustment.

Related terms

Invoice

A seller’s itemised request for payment for goods or services.

Accounts Receivable

AR

Money owed to your business by customers for sales made on credit.

Aging Report

A breakdown of receivables or payables by how overdue they are.

Debit Note

A document raised to reduce what you owe a supplier.

More in Accounting

Accounts Payable (AP) Accrual Accounting Accrued Expense Bad Debt Provision Balance Sheet Bank Reconciliation Break-Even Point Budget Variance

Credit Note is not just a definition here

Accounting runs on this vocabulary every day in AWRA OpsHub — 51 of our 257 glossary terms describe things the platform actually does.

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