If a customer returns faulty goods or you wish to credit their account for any other reason, you need to create a credit note. This credit note can later be allocated to a sale or paid out as a refund.
The simplest way to create a credit note is to edit an existing invoice and click More Options > Copy To Credit Note. (f you want to create an credit note that doesn't relate to an existing invoice in Solar Accounts click menu File > New > Credit Note). The Credit Note window will appear:
Enter the details of the credit note into the following fields:
Customer: The name of your customer.
Credit No: The identifying number you want to use to refer to this credit note. Note that you can change the default number sequence.
Customer PO No: The purchase order number which the customer uses to refer to their order. Can be left blank if the customer hasn't given you an order number.
Date: The date you issued the credit note.
Qty: The quantity of goods or services returned (e.g. 15 kilograms or 8 hours).
Description: A reason why the account is being credited. To enter a long description with multiple lines, click the ellipsis ('...') button to the right of the current description field.
Account: This is the account used to keep track of your sales, usually 'Sales Income'. A credit note will reduce the balance of this sales account.
VAT Column (only shown if registered for VAT): This is the rate of VAT you charged your customer when you made the sale. This is usually 20%, but there are exceptions – if you're not sure of the correct rate, talk to your accountant or call the HMRC National Advice Service on 0845 010 9000.
Unit Price: This is the price you charge per unit of goods or services refunded (e.g. £4.70 per kilogram or £40 per hour)
Line Total: The total amount for the credit note line – automatically calculated as Quantity multiplied by Unit Price.
Prices Include VAT: By default, the Unit Price and Line Total amounts do not include VAT. Tick this box if you prefer to enter the amounts including VAT.
Comment: A comment that will appear on the credit note. You should enter details of the original sale related to this credit (ie. invoice number and date).
Subtotal: The total of all credit note lines.
VAT: The total VAT included in the credit amount.
Total: The total credit amount.
More Options > VAT Treatment (only shown if registered for VAT): This list determines how your credit note will affect your VAT return. Select the option which best describes the original sale.
Journal Memo: A description of this credit note to appear in your transaction list.
Paid Today (only shown for new credit notes): If you paid a refund to the customer on the date of the credit note, enter the amount paid here. This will create a new refund transaction associated with this credit note.
Paid or Applied (only shown for existing credit notes): This is the total amount paid to the customer or applied to another sale.
Balance: The balance remaining – this is the amount which is yet to be refunded or applied to another sale.
Once you've entered the credit note details, click OK to save it. The credit note will appear in the Invoices list (accessible by clicking menu Window > Invoices). You can print the credit note by selecting it in the list and clicking menu File > Print.
Once you've created a credit note, you should pay a refund or allocate the credit to an invoice.
