Creating a credit invoice
Do you need to change an invoice that has already been sent to your customer? Or did you agree with your customer that you will charge less for your services? No problem! In these cases you send a credit invoice to your customer. With a credit invoice you can create a correction for the originally sent invoice. You may not delete the original invoice, otherwise the Dutch tax authorities will have some questions for you. But what is a credit invoice? And how do you create one? In this wiki we will explain what a credit invoice means for you.
What is a credit invoice?
A credit invoice is actually a normal invoice that states the amount that you need to correct from your previously sent invoice. The amount of your original invoice is then (partially) settled and the end result is often €0. Your customer does not have to do anything if they have not paid yet. Please note, that even if your customer has not yet paid for the original invoice, you still send a credit invoice to your customer.
Creating a credit invoice is quite simple. When you create a credit invoice in Gekko the data from your previously sent invoice is automatically copied. However, the amounts on the credit invoice will be negative in order to correct the previous invoice.
A credit invoice is written proof that there has been no payment for your previously sent invoice. It is not sufficient to just verbally agree with your customer that there is no need to pay for an invoice that has been sent, because there is no record of a private conversation. Therefore, by making a credit invoice you keep your administration in check.
Often no payment is made when sending a credit invoice. If the customer has not paid the original invoice, the customer does not have to get a refund. But suppose your customer has already paid for the original invoice. In this case you can transfer the amount back to your customer, or make another arrangement.
In Gekko you still have to add a payment for the original invoice, and for the credit invoice.
What else should you pay attention to?
You can include a credit invoice in your regular invoice numbering or start a separate series with only credit invoices. Both options are possible, provided you are consistent. If you send a credit invoice, do not forget to mention the invoice number of the old incorrect invoice in your accompanying message. This is not necessary, but an invoice will help your customer to understand which invoice this concerns.
A credit invoice has to follow the invoice requirements of a normal invoice. Therefore, there is also VAT on your credit invoice, the details of your company, and the company information of your customer. There is also a retention obligation of 7 years with a credit invoice, just like with a normal invoice
The balance sheet, and profit & loss overview are snapshots of your administration and this can sometimes be confusing, even with credit invoices. Because a credit invoice can affect your profit & loss overview.
For example, you sent an invoice in December and received a payment for this invoice, but there was an mistake in your invoice. You then send a credit invoice in January, but what does this mean for your administration?
Total revenue will have increased in the previous year. But the total revenue in the following year will have a negative amount, the same goes for your profits. However, because the equity remains net zero €0, under 'withdrawals & deposits' a negative amount will have been withdrawn for the previous year, and a positive amount will have been deposited in the following year. In the end it all evens out.