Credit notes in Ireland: when and how to issue one
When a VAT credit note is needed, what it must contain and how it corrects the VAT on your invoice.
Issue a credit note when the price on an invoice you have already issued goes down. That covers a discount, an allowance, a returned item or a wrong VAT rate. Revenue treats the credit note as the document that adjusts the VAT charged on the original supply. It also lets your VAT-registered customer adjust the VAT they claimed. Do not overwrite or delete the original invoice. Issue a separate, numbered credit note that points back to it.
- A credit note reduces the amount on an invoice already issued.
- It is used for discounts, allowances, returns and incorrect VAT rates.
- It should refer to the original invoice and show the VAT adjustment.
- The original invoice stays on file; the credit note corrects it.
How it works
Identify the reason. A discount or allowance agreed after invoicing, goods returned, or a wrong VAT rate on the original invoice all call for a credit note.
Label it clearly. Show the words "credit note", a unique number and the issue date. Keep the numbering distinct from your invoice sequence.
Reference the original. Quote the original invoice number and date, and repeat the supplier and customer details.
Show the adjustment. State the net amount credited, the VAT rate, the VAT amount credited and the total credited.
Reflect it in your VAT return. The credit note adjusts the VAT you account for, and your customer adjusts the VAT they reclaimed. Check Revenue's guidance for the timing rules.
Legal basis
- Revenue guidance: VAT records, invoices and credit notes.
- Value-Added Tax Consolidation Act 2010 (as amended).
Frequently asked questions
When must I issue a VAT credit note in Ireland?
When the price on an invoice you issued is reduced, for example by a discount or allowance, or when the VAT rate on it was wrong. Revenue's guidance on when a VAT credit note must be issued sets out the timing, so check it for your case.
Can I just edit or delete the original invoice?
No. Keep the original invoice and issue a separate credit note that refers to it. That keeps your records complete and consistent.
What must a credit note show?
It should show the words credit note, a unique number, the date, a reference to the original invoice, the supplier and customer details, and the net, VAT rate, VAT amount and total credited.
Does a credit note change my VAT return?
Yes. It adjusts the VAT you account for on the original supply, and it also adjusts the VAT your VAT-registered customer claimed.
Does 4invoices issue credit notes or file my VAT?
4invoices lets you create invoices with a VAT rate per line, in any currency, and download them as PDF. You can use it to prepare a corrected document. It does not connect to Revenue, does not file returns and does not certify compliance. You remain responsible for the content and for your VAT3.