Issue a Credit Note

A credit note (document type TD04) is used to fully or partially reverse an invoice you’ve already issued. You need it when you’ve made an error on an invoice, want to apply a retroactive discount, or a customer has returned goods.

When do you need a credit note?

Here are the most common situations requiring a credit note:

Important: If the original invoice is still in “Draft” status and hasn’t been sent to SDI, you can simply edit or delete it. Credit notes are only needed to correct invoices that have already been sent.

Before you start

To issue a credit note you need:

• The original invoice to link the reversal to (must be in your invoice list)
• The correct data to include in the credit note

How to create a credit note

Step 1: Open the Issued Invoices list

1. From the sidebar menu, click on Invoices
2. Make sure you’re in the Issued section (invoices you’ve sent to customers)

Step 2: Find the invoice to reverse

Search the list for the invoice you want to issue a credit note for. You can use:

• The search bar to search by number or customer
• Filters by date or status

Step 3: Open the actions menu

1. Locate the invoice in the list
2. Click the three dots icon (⋮) on the right side of the row
3. A menu with several options opens

Step 4: Select “Create credit note”

In the actions menu, click Create credit note.

Don’t see this option? This option only appears for documents that aren’t already credit notes. If you’re looking at a credit note (TD04), you won’t be able to create another one from it.

Step 5: Fill in the credit note

The system automatically creates a new credit note with:

• Document type: TD04 (Credit note)
• Customer: Same as the original invoice
• Lines: Copied from the original invoice

What you need to check and modify:

Step 6: Full or partial reversal?

If you want to reverse the entire invoice:

• Leave the lines as they were copied
• The credit note total will equal the invoice total

If you want to reverse only part:

• Modify the quantities or amounts of the lines
• Delete lines you don’t need to reverse
• Keep only what you actually need to cancel

Partial reversal example: The original invoice was for 3 products at 100 euros each (total 300 euros). The customer returns 1. You create a credit note with just 1 line for 100 euros.

Step 7: Check the summary

Before proceeding, check the summary on the right:

• Taxable amount: The amount you’re reversing
• VAT: Calculated based on the line tax rates
• Total: The amount the customer will receive as credit

Step 8: Save or Send

You have two options:

Practical example

Situation: You issued invoice no. 15 to customer ABC Ltd for 500 euros + VAT, but you entered the wrong price. The correct price was 450 euros.

Solution in 2 steps:

1. Issue credit note to reverse invoice no. 15 (500 euros + VAT)
2. Issue new invoice with the correct amount (450 euros + VAT)

How to proceed:

1. Go to Invoices → Issued
2. Find invoice no. 15
3. Click the three dots (⋮) → Create credit note
4. Verify the amount is 500 euros
5. Click Send to send it to SDI
6. Return to the invoice list and click New invoice
7. Select the same customer (ABC Ltd)
8. Enter the correct amount (450 euros)
9. Click Send

Credit note numbering

Credit notes have a separate numbering sequence from invoices. This means:

• Invoices follow the sequence: 1, 2, 3…
• Credit notes follow their own sequence: 1, 2, 3…

You can configure the numbering format in Settings → Numbering → Credit Note.

Frequently asked questions

Can I create a credit note from a draft invoice?

Yes, it’s technically possible, but it doesn’t make practical sense. If the invoice is still a draft, you can simply edit or delete it directly.

Does the credit note need to be for the same amount as the invoice?

No, you can issue credit notes for partial amounts. For example, if the invoice was for 1,000 euros, you can issue a credit note for 200 euros for a discount applied later.

What happens after I send the credit note?

The credit note is sent to the Exchange System (SDI), which delivers it to your customer. The customer will receive it in their tax portal or via the destination code/PEC indicated in the invoice.

Does the customer need to do anything?

No, the credit note is a document you issue. The customer receives it as notification that they have a credit with you (meaning they need to pay you less or receive a refund).

I made a mistake on the credit note too. What do I do?

If you’ve sent a credit note with errors, you need to issue a debit note (TD05) to cancel the incorrect credit note. Alternatively, contact your accountant to evaluate the best solution.

Do I need to manually link the credit note to the original invoice?

No, the link is created automatically when you use the “Create credit note” function from the original invoice. The system maintains the reference to the source document.

Need help?

If you have questions about how to handle a credit note or which document to issue, contact us:

• WhatsApp: Click the icon at the bottom right
• Email: support@fatturasmart.com

Other useful guides:

• Create an Invoice as a Flat-Rate Taxpayer →
• Configure Numbering →