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Issuing Credits
Credit notes allow you to allocate a negative balance change to an invoice line. This feature is useful for adjusting errors in unpaid or partially paid invoices. You can also provide credit to a user account and then allocate that credit to decrease the balance of their invoices at a later date. Finally, credit notes provide accurate and complete recordkeeping of the transactions that occur after an invoice has been posted. (Salesforce Billing Managed Package)
Required Editions
| Available in: All Salesforce Billing Editions |
The credit note object has a lookup to the account. You can allocate credit notes only to invoice lines on that account. By default, credit notes have a draft status. Tax hasn’t yet been applied and no allocations have been made. Without any additional actions or processes, the credit note remains in draft status and doesn’t show up in finance periods or revenue transactions.
Credit note lines track the actual amount to be allocated across one or more invoice lines. They contain subtotal, tax, and total amount (with tax) fields, and a lookup to the product object. The product lookup provides context for why you’re allocating the credit note line. For example, if your credit note allocates $50 to a customer’s invoice based on store credit, the Product field looks up to the Store Credit product record. A credit note record stores its credit note lines in a related list, and provides a summary of its total credit note values. This relationship allows you to organize your credit note lines into one credit note based on their purpose.
A positive credit note line allocation decreases the balance of an invoice line. A negative credit note line allocation increases the balance of an invoice line. Consider the following examples.
- Allocating a $100 credit note line to a $500 invoice line changes the invoice line’s balance to $400.
- Allocating a -$100 credit note line to a -$500 invoice line changes the invoice line’s balance to -$400.
Salesforce Billing provides five ways to create a credit note.
| Use Case | Action | Result |
|---|---|---|
| Your posted invoice contains an error, and you must rebill the customer for the billing period. Since you can’t change an invoice’s total amount, you must apply credit note lines to each invoice line so you can zero out the balance. | Click Cancel and Rebill on the invoice. | Salesforce Billing creates a credit note equal to the invoice’s total balance. The credit note contains credit note lines that are allocated in full to each of your invoice lines. Salesforce Billing also evaluates each invoice line’s originating order product and reverts its Next Billing Date field to its previous value. |
Your posted invoice must be fully credited so the customer isn’t rebilled for the billing period. Crediting an invoice without rebilling effectively gives customers a free product for one-time products, or a free billing period of service for recurring products. For example, you shipped damaged goods before their payment or charged them for an extra service period after they canceled their service and paid the final bill. |
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In both methods, Salesforce Billing doesn’t revert credit order products to their previous next billing dates. |
| When you amend an order product and reduce its quantity or price, invoice lines from the amended order product often have a negative balance. | Click Convert Negative Lines on the invoice. | Salesforce Billing creates a credit note with credit lines equal to the balances of each of your negative invoice lines. You can apply these credit note lines to payments or to reduce the balance of the same invoice. |
Your credit note lines contain an optional lookup to a legal entity. Provide a value to this lookup if you want to associate your credit note line to a revenue schedule or GL account for bookkeeping and revenue tracking. You can also manually create a credit note and then create its credit note lines.
You can also manually create a credit note and then create its credit note lines. Manually created credit notes use the following guidelines.
- To save a credit note line, you have to enter only the Account field and the Product field.
- If you don’t enter a credit note line date, the credit note line inherits its date from the parent credit note.
- When you save your credit note line, Salesforce Billing provides its rule and treatment lookups based on the credit note line’s legal entity and product.
- Credit note lines save in the draft status by default. You can post a credit note line by changing its status to Posted, posting the parent credit note record, or applying tax on the parent credit note record.
- Cancel and Rebill an Invoice
Use the Cancel and Rebill option to revert the invoice to its prior state before the most recent billing cycle. Use this option to fix any errors in the invoice record. (Salesforce Billing Managed Package) - Convert a Negative Invoice Line to a Credit Note
When you amend an order to decrease the quantity of an order product, your next invoice often has a corresponding invoice line with a negative balance. Convert these negative invoice lines to credit notes and issue those credit notes as refunds or apply them to other invoice lines. (Salesforce Billing Managed Package) - Create a Credit Note and Apply Tax
Create a credit note record and several credit note lines, then apply tax to the credit note. After applying tax, you can allocate your credit note lines to change the balance of an invoice line. (Salesforce Billing Managed Package) - Create a Credit Note Without Tax
Create a credit note record so you can allocate it at a future date. (Salesforce Billing Managed Package) - Guidelines for Credit Note Tax
Salesforce Billing calls your external tax engine to calculate tax for your credit note lines. You can also estimate tax before applying it to the credit note lines. (Salesforce Billing Managed Package) - Allocate a Credit Note
Allocate your credit note to decrease the change the balance of one or more invoice lines. (Salesforce Billing Managed Package) - Issue Partial Credit
Allocate a negative balance change to an invoice line to adjust errors in unpaid or partially paid invoices. (Salesforce Billing Managed Package) - Correct Errors on Posted Credit Notes
Salesforce Billing must retain a copy of all credit notes for legal and accounting purposes. To fix an error on a posted credit note, create a debit note of equal value and allocate it to each line of the original credit note. The allocation reduces the erroneous credit note’s balance to zero. You can then create and post a credit note with the correct values. (Salesforce Billing Managed Package) - Credit Center
Billing operations and customer service teams can use the Credit Center to quickly credit multiple invoice lines on an invoice. They can credit invoice lines, apply tax per credit note line, and preview the results of the credit note before posting it to the invoice. (Salesforce Billing Managed Package)
