Credit and debit notes

Once an invoice is issued, it is not changed in place. When the amount turns out to be too high, a credit note reduces it; when it was too low, a further charge is billed. This page explains which document fits each case and what tax law asks it to show. It is general information, not tax or legal advice: check the sources at the end or ask your accountant before you rely on it.

In short

• Credit note: the customer owes less than the invoice said — goods returned, a service not accepted, an overcharge, a discount given afterwards, or a sale cancelled.
• Debit note: the customer owes more for the same sale. In Malaysia it is the named document for that. In Singapore, IRAS says a standard-rated charge to a GST-registered customer needs a tax invoice, not a debit note.
• A credit note names the invoice it corrects and the reason, and states the change in tax.
• In Singapore, Malaysia and New Zealand the tax adjustment goes in the return for the period in which the note is issued; in Australia, the period in which you become aware of the adjustment.

Country by country

Singapore

IRAS lists the cases for a credit note: correcting a mistake, goods or services not supplied, charges waived, contract terms not fully met, goods returned or services not accepted, and a discount on a past sale. The note shows its own number and date, your name, address and GST registration number, the customer’s name and address, the reason, each item’s quantity and amount, the totals and the GST, and the number and date of the original tax invoice. You adjust the GST in the return for the period in which the credit note is issued, except for a credit note that corrects a wrong GST treatment where the conditions for correcting it in the next return are not met: that goes in a GST F7. IRAS says a debit note is for billing where no GST is charged, such as internal billing, or for suppliers from whom credit is due.

Hong Kong

There is no sales tax, so no prescribed format. The Inland Revenue Department recommends giving the customer a credit note for returned sales, as the basis for adjusting your sales records.

Australia

GST law calls the document an adjustment note. It is needed after an adjustment event — anything that cancels a sale, changes its price or changes whether it is taxable. You give it within 28 days of the customer asking for it or, if you issued a tax invoice, within 28 days of becoming aware of the adjustment. That duty does not apply where the decreasing adjustment, the reduction in GST, is A$75 or less. The note shows that it is an adjustment note, your identity and ABN, the issue date, a brief reason, the GST adjustment and the price difference, and the customer’s identity or ABN where the original price was A$1,000 or more.

New Zealand

Since 1 April 2023 credit and debit notes are supply correction information. A seller provides it to correct an error in the original taxable supply information, whether or not the buyer has paid. It shows your name and GST number, the date of the correction, details identifying the original, such as the invoice number, and the correction, including any change in tax. You include it in the GST return for the period in which you provided it. It is not needed for a discount or rebate whose terms were agreed in writing or set out in the original.

Japan

A registered issuer that gives a taxable business a return, discount or rebate issues a return invoice (適格返還請求書). The duty is waived when the refund is under ¥10,000 including tax. The return invoice shows your name and registration number, the date of the refund and of the original sale, the description, and the refund per rate with its tax or rate. If an issued invoice contains an error, you give the customer a corrected one (修正した適格請求書).

Malaysia and Brunei

For Malaysian service tax, a credit note is issued when an invoice’s value is reduced or the sale is cancelled, and a debit note when the value is increased. Each carries the words “credit note” or “debit note”, a serial number, the date, your details, the buyer’s details, the reason, the amounts and tax, and the number and date of the original invoice. An issued invoice must not be altered: an invoice issued in error is marked “CANCELLED”. Brunei has no GST or VAT.

In easySales

• Create a credit note from the invoice it corrects, on the invoice’s Credit notes tab, and pick a Reason: Reversal, Goods returned, Allowance, Over-invoiced or Other. See Create a credit note.
• To withdraw an invoice completely, cancel it: easySales issues a Reversal credit note for the whole amount. See Cancel an invoice.
• easySales has no debit note. To bill an amount you left off, issue a new invoice for it.
• A credit note in a foreign currency converts at the rate of the invoice it credits. See Currency and rates.

Examples

Harbour Café returns two chairs from Lim & Co’s invoice INV-10000412, at SGD 350.00 each. Mei Tan creates a Goods returned credit note for SGD 700.00 plus GST of SGD 63.00, SGD 763.00 in all. It names INV-10000412, and Lim & Co reduces its output tax by SGD 63.00 in the return for the period in which the credit note is issued.

A week later Daniel Lim notices that a SGD 200.00 installation fee was left off the same job. He issues a new invoice for SGD 200.00 plus GST of SGD 18.00 rather than changing the old one.

Common questions

• When do I issue a credit note instead of a new invoice? Issue a credit note when the customer owes less than the invoice said. When they owe more, bill the difference on a new document.
• What is the difference between a credit note and a debit note? A credit note reduces what the customer owes on an earlier invoice; a debit note increases it. In Singapore, IRAS limits debit notes to charges with no GST and to suppliers who owe you credit.
• Is there a time limit for issuing a credit note? In Australia, 28 days from the customer’s request or from becoming aware of the adjustment, where you issued a tax invoice. Singapore sets 14 days only for the special credit notes after a GST rate change.
• Does a credit note need the original invoice number? Singapore and Malaysia ask for the original invoice’s number and date, and New Zealand for details that identify it, such as its number. In Japan the return invoice shows the date of the original sale.
• In which GST return does a credit note go? In Singapore, Malaysia and New Zealand, the return for the period in which the note is issued, not the period of the original invoice. In Australia, the period in which you become aware of the adjustment.
• Can I just edit an issued invoice instead? No. In Malaysia altering an issued invoice is prohibited; easySales locks every issued invoice. See Fixing mistakes.

Sources

Last checked: 21 October 2026.

• IRAS — Invoicing customers
• Singapore Statutes Online — GST (General) Regulations, regulation 12
• IRD Hong Kong — A Guide to Keeping Business Records (PDF)
• Federal Register of Legislation — GST Act 1999, sections 19-10, 29-20, 29-75 and 29-80
• Federal Register of Legislation — GST Regulations 2019, regulation 29-80.02
• Federal Register of Legislation — Adjustment Note Information Requirements Determination 2022
• Inland Revenue NZ — Supply correction information
• National Tax Agency Japan — Qualified invoice Q&A (PDF, Japanese), questions 27, 28, 33 and 60
• RMCD MySST — Issuing invoices

Related

• Credit notes
• Fixing mistakes
• Cancel an invoice
• Country tax & invoice rules