A credit note will be required if you have invoiced for services or supplies which no longer apply and you need to reduce the total amount of this initial invoice.
For example, you have agreed to sell 100 bales of hay to another farmer and have sent the invoice. You only ended up providing 80 bales which the farmer paid for. The invoice has already been saved and sent. Now you need to send a credit note to account for the credit of the 20 bales. Legally tax invoices can not be altered once they have been sent to a supplier.
Follow this process to create a credit note:
Go into your Actuals section and select Tax Invoices.
Find the corresponding tax invoice the credit notes relates to and click into it.
Under More Options, click the drop down arrow.
Select Copy as credit note.
A credit note will appear that has exactly the same information as the tax invoice. Make the appropriate changes. In this example you intend to credit the supplier for the 20 bales that they did not receive. NOTE: Check the dates are correct as they default to the date the credit note as created.
We recommend you include a note explaining the circumstances around the requirement for a credit note.
Preview & generate the credit note. You will now be in Preview view. Check that the information contained in the credit note is correct. The credit note is clearly marked Credit Note. IRD requires that the invoice number to which the credit note relates is documented in the corresponding credit note. Farm Focus automatically does this for you.
Tick the box Email to: if you want the credit note to be automatically emailed to the supplier.
You can include additional attachments in the emailed credit note, allowing you to substantiate the reason for the credit note. These need to be attached before you Preview & Generate the credit note. Click here to learn how.
Generate & Send once you are happy with the changes. Information in the credit note cannot be changed after it has been generated.
Once generated a copy of the credit note will sit in the Needs Action screen easily identifiable by the letters CN. Tax invoices have the letters INV.
A copy of the invoice will also sit in the Tax Invoices tab of the Needs Action screen.
You can now Match this to the relevant transaction along with the initial invoice. Read this article for more information on Matching.
