Credit note calculator: work out a partial return or a price reduction
A credit note lowers what a customer owes on an invoice. Enter the goods returned, or an amount to take off, and see the credit note’s net, VAT and total, and what remains of the invoice.
Credit note calculator
Choose what the credit note is for. Amounts are in riyals.
Enter the lines of the original invoice and the quantity returned from each. Leave the quantity empty for lines that stay as they are.
Line 1
Credit note amounts
Fill in the form to see the credit note amounts.
What your credit note must show
- The number and date of the original invoice
- A clear, specific reason for the note
- The items or amounts being reduced
- The VAT on the adjusted amounts
- Its own sequential number and date
VAT is rounded to the halala line by line. If your invoicing system rounds differently, the totals can differ by a halala.
This calculator shows the arithmetic only: it does not issue a credit note. Issue the note from your invoicing system, and check with ZATCA or your accountant how to treat it.
How the credit note is worked out
For goods returned, each line is worked out like a line of the original invoice: the quantity returned times the unit price gives the amount excluding VAT, and VAT is added at the line’s rate and rounded to the halala. The credit note is the sum of those lines. Returning a whole line gives exactly the amounts of that line on the invoice.
For a price reduction, the amount you enter is either split into the amount excluding VAT and the VAT it contains, or has VAT added at the rate you choose, depending on whether it already includes VAT. If you enter the original invoice total, the calculator also shows what is left of it.
The result is arithmetic for the credit note. The note itself must reference the original invoice and give a reason, as the guide to credit and debit notes explains.
Good to know
- An issued invoice is not edited or deleted. A credit note is the way to reduce it, and it needs its own number and date.
- A credit note lowers the VAT you charged on the sale as well as the amount. Your next VAT return should reflect it: ask your accountant how to show it.
- Zero-rated lines carry no VAT. Exempt supplies and other cases are not covered: ask your accountant how to credit them.
- Nothing you type is stored or sent. The calculation runs in your browser.
Questions about credit notes
How do I work out a credit note for a partial return?
Multiply the quantity returned by the unit price on the invoice, add VAT at the same rate, and round it to the halala. This calculator does it line by line and adds the lines.
Does a credit note reduce the VAT as well?
Yes. The credit note shows the VAT on the amount it reduces, so the VAT you charged on the sale falls by that amount. Show it in your VAT return as your accountant advises.
What is the difference between a credit note and a refund?
A credit note is the document that corrects the invoice. A refund is the money you give back, which may follow. The note is needed either way, because the invoice cannot be edited.
Can I issue a credit note without the original invoice?
No. A credit note refers to the invoice it corrects, by number and date, so that anyone reading it can find the original sale.
Does this tool issue the credit note?
No. It only works out the amounts. Issue the credit note from your invoicing system, so that it has its own number and goes through the e-invoicing steps your business is subject to.
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