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Query Answer
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How to issue a credit note?

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Credit Note— A credit note can be issued after a tax invoice when the taxable value and tax charged in the invoice is more than the taxable value or tax chargeable for the supply. Hence, the following are instances when a taxpayer can issue a credit note to the customer:

  • When tax invoice is found to exceed the value of supply
  • When goods are returned by the customer
  • When goods are found to be deficient

A debit note is issued after a tax invoice when the taxable value or tax charged in the invoice is found to be less than the value payable by the customer. On the other hand, a credit note is issued when the taxable value in the invoice is more than the taxable value chargeable for the supply.

There is no prescribed format but credit note issued by a supplier must contain the following particulars, namely:  

(a) name, address and Goods and Services Tax Identification Number of the supplier; 
(b) nature of the document; 
(c) a consecutive serial number not exceeding sixteen characters, in one or multiple series, containing alphabets or numerals or special characters hyphen or dash and slash symbolized as “-” and “/” respectively, and any combination thereof, unique for a financial year;
(d) date of issue; 
(e) name, address and Goods and Services Tax Identification Number or Unique Identity Number, if registered, of the recipient; 
(f) name and address of the recipient and the address of delivery, along with the name of State and its code, if such recipient is un-registered; 
(g) serial number and date of the corresponding tax invoice or, as the case may be, bill of supply; 
(h) value of taxable supply of goods or services, rate of tax and the amount of the tax credited to the recipient; and 
(i) Signature or digital signature of the supplier or his authorised representative.  

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