There’s nothing worse than sending an invoice to your customer and later noticing it has a mistake on it. Perhaps it’s only a typo, but perhaps it’s something more important, maybe an incorrect amount or even a missing item. In these cases, you then need to know what to do.
This post summarises how to correct an invoice you’ve already sent to your customer and what you need to do to make sure your accounts still add up.
Use a credit note to cancel an invoice
The most common way to fix a mistake is to cancel an invoice with a credit note. Credit notes are legal documents that are used to ‘pay’ an invoice that needs to be cancelled and balance your books. It stops an incorrect invoice from being ‘overdue’. Suppose that you’ve issued your invoice, but your customer contacts you to say something needs is wrong. Perhaps for example, you’ve forgotten to add a discount you had previously agreed upon, you have added an item twice, or the customer’s details are incorrect. In these cases, you then need to issue a credit note.
Simply open the incorrect invoice and tap ‘⋮’ > ‘Create’ > ‘Credit Note’. The information on the incorrect invoice will be automatically transferred to the credit note you’re drafting, and the credit note will be assigned its own credit note number.
When you’re ready, just tap ‘Complete’. This will mark the incorrect invoice as ‘paid’ and you can send the credit note to your customer. This will let them know the invoice is cancelled and they shouldn’t pay you.
You can then go back to your invoices tab and open your list of credit notes. The credit note will then be marked as ‘matched’. By following this procedure, your accounts will be balanced, and you won’t have any overdue payments.
Can I delete an invoice?
Answered simply, no. You should never delete an invoice, even if it is mistaken. It’s a legal document that you’ve sent to your customer. You therefore need to assure them that the invoice has been cancelled and they are not indebted to you by issuing them a credit note.
Editing an invoice that has been sent
Occasionally, it may be possible to edit an invoice that has already been sent, although this is not common practice. Suppose for example, you’ve made a small error such as an embarrassing spelling mistake or a typo in your contact details. What you would need to do is open the sent invoice and click ‘⋮’ > ‘Edit’. You can then make your correction and when you’re done, click ‘Save’.
You have to remember though; you have already sent this invoice to your customer via the Debitoor system. What does this mean? It means your customer has received an email from you with a link for them to view your invoice and a PDF attachment.
Therefore, if you make a change to the invoice, the link will direct your customer to the updated version of the invoice. However, the PDF attachment will not have changed. Therefore, it’s necessary that you explain what you have done so that both you and your customer are on the same page.
Never make changes to the prices on an invoice you have already sent. The amended invoice will still have the same invoice number and will confuse your customer. In this case, you must create a credit note instead and start again.
Correcting mistakes on a paid invoice
If you’re unfortunate, you may find that not only has your invoice been sent with a mistake on it, but the customer has also already paid the amount due. Depending on the severity of the mistake, there are different things that you can do.
Perhaps at this point, it’s necessary to consider whether a simple typo needs fixing. Maybe not. However, if you have made a mistake in your pricing, you’ll need to fix this by issuing your customer a refund. A credit note should therefore be completed by opening the ‘paid’ invoice and clicking ‘⋮’ > ‘Create’ > ‘Credit Note’. Once done, a new invoice with the correct amount should be sent.
Depending on the situation, it may be possible to issue a partial credit note, for example, if you’ve added the same item twice. In that case, you can create a credit note for just that item and then give a refund.
In the system, open the original invoice and create a credit note. The credit note will then be marked as ‘paid’ and the incorrect invoice will be marked as ‘partially paid’. Then, simply reopen the invoice and click ‘Add payment’. The amount will be shown in red (to show it’s money out) and will be the same amount as the credit note you created. Just click ‘Save’, and the invoice will once again me marked as fully paid, showing all of your accounts add up!
At other times, a full credit note and refund may be easier to handle. If there is a discount you have forgotten to apply, if there are multiple mistakes, or if your customer requires a new invoice, you should cancel the entire invoice, give a refund, and begin again.
Correcting mistakes on an invoice – a summary
Mistakes are frustrating, but they’re also pretty common. You need to deal with them carefully and follow the correct procedure to ensure you do not complicate your accounts or confuse your customer.
Most importantly, you need to remember:
- Any changes you need to make to prices, discounts or VAT require that you first cancel the sent invoice with a credit note, and then create a new one.
- Any changes you make to an invoice need to be clearly communicated to your customer. If you are unsure, cancel the sent invoice with a credit note, and then issue them with a new one.
- Never delete an invoice. If you have sent an invoice to a customer or reported it to the tax authorities, it may be unlawful to remove it from your accounts.