How to issue a correct credit note
A credit note corrects an invoice that has already been issued. The invoice stays in the record as it is; the note records the change and points to it.
Start from the invoice itself
If the invoice is still open in the invoice generator, press the “Credit note” tab: its number, date and value move into the note’s reference, and the note takes its own serial and today’s date.
Choose the reason
Cancellation, a return, a change to the agreed value, a material change to the supply, or a correction to the seller’s or buyer’s details. Saudi Arabia and the UAE both require the reason.
Enter only what is being credited
The note’s lines are the difference, not the whole invoice: if five of ten units come back, the line is five units. VAT is worked out on the difference at each line’s rate, and every amount stays positive.
Check the corrected value and download
Enter the value of the supply on the original invoice and the tool prints the corrected value, the difference and the VAT on it — and warns you if the note exceeds the invoice or predates it.
A credit note, not a deletion
An issued invoice is never deleted or edited. ZATCA’s e-invoicing FAQ is explicit that after issuing an invoice it is prohibited to modify or cancel it, and that a credit or debit note must be generated instead. If the whole invoice is wrong, credit it in full and issue a correct one.
Many businesses call it a “return invoice” or a “sales return”. The name does not matter: the document that evidences the return for tax is the credit note, and the final position is the original invoice read together with the note.
When a credit note is due
In Saudi Arabia the events are listed in Article 40(1) of the VAT Implementing Regulations, and where the tax charged on the invoice now exceeds the tax due, the supplier must provide a credit note (Article 54). In the UAE, Article 61 of the Decree-Law lists similar events and adds tax charged in error.
- The supply is cancelled or suspended, wholly or partially, after it took place
- Goods or services are returned and the supplier accepts the return
- The agreed value of the supply changes, including an extra discount after the sale
- A material change to the supply changes the VAT due
- The seller’s or customer’s details on the invoice are wrong — optional in Saudi Arabia under Article 54(3)
What the note must contain, country by country
There is no single credit note template that is right across the Gulf. This is what the official texts say, as read:
When you choose the country, the tool changes the document title and the required fields, and names the official text above the form.
- Saudi Arabia — Implementing Regulations Article 54 and Annex 2 of the E-Invoicing Resolution: the tax invoice particulars for its type, plus a reference to the original invoice or invoices and the reason for the note, both visible on the printout.
- UAE — Executive Regulation Article 60: the words “Tax Credit Note”, supplier and recipient details, the date of issue, the value on the invoice, the correct value, the difference and the VAT on the difference, and a brief explanation of the circumstances.
- Bahrain — Executive Regulations Article 54: the words “Credit Note”, a sequential note number, the original tax invoice number, and the corrected value of the supply and tax to be adjusted in dinars. No reason is listed.
- Oman — Executive Regulations Article 155: an amended document conforming to the tax invoice particulars, referring to the invoice or set of invoices amended and the tax to be adjusted.
- Kuwait and Qatar — no VAT regime, so the note is a commercial correction with no VAT line.
The deadline: two different clocks
In Saudi Arabia a sixth paragraph added to Article 54 requires the note within fifteen days of the month following the event. ZATCA’s guideline reads it as within 15 days following the end of the month in which the event occurred: an event on 3 March means a note by 15 April — not 15 days from the event.
In the UAE it is 14 days from the event (Article 62), counted in calendar days. The FTA’s own example: the refund was made on 6 February, so the credit note was due by 20 February.
Enter the date of the event in the tool and it shows the last day under the selected country’s rule.
In the UAE: four figures, not one
Most credit note templates print a single “credit amount”. The UAE Executive Regulation requires the value of the supply shown on the tax invoice, the correct value, the difference between them, and the tax charged on that difference.
Where more than one credit note is issued against the same invoice, the value in the later note is the value as adjusted by the earlier one. The FTA’s example: goods sold for AED 105 including VAT, credited by AED 21 including VAT — the next note shows a supply value of AED 80 (100 − 20).
When a PDF is not enough
The note this tool produces is a printed document carrying the required fields and a five-field QR code. Where e-invoicing applies it is not an electronic note in the legal sense, and it is never presented as one.
- Saudi Arabia: resident taxable persons must issue electronic notes, and the E-Invoicing Regulation states that paper notes converted to electronic form by copying, scanning or any other method are not electronic notes. In Phase 2 the QR code needs a cryptographic stamp issued through ZATCA, which a browser tool cannot produce.
- UAE: the e-invoicing system covers the Electronic Credit Note. Businesses with revenue of AED 50 million or more must implement it by 1 January 2027, others by 1 July 2027, and business-to-consumer transactions are excluded until a further decision.
- Oman: the amended document must be issued electronically where the original invoice was issued electronically.
- Jordan: the invoice that counts is the one issued by the national e-invoicing system or a system linked to it, and returns are processed through it.
Jordan: the “return invoice” in the national e-invoicing system
In the official JoFotara portal user guide, a return is made by choosing «فاتورة ارجاع» (return invoice), entering the electronic number of the invoice being returned, entering the reason for the notice, entering the quantity returned, and issuing.
The portal refuses a note dated before the original invoice. This tool applies the same check, but it does not replace issuing the return through the system.
Frequently asked questions
Can I delete an invoice issued by mistake instead of issuing a credit note?
No. An issued invoice cannot be cancelled, deleted or edited; a credit or debit note linked to it is issued instead. If the whole invoice is wrong, credit it in full and issue a new, correct invoice.
Does a credit note have to quote the original invoice number?
Yes, expressly, in Saudi Arabia, Bahrain and Oman. The UAE requires information sufficient to identify the supply, and the invoice number is the practical way to give it. In Saudi Arabia one note may refer to several invoices, and their numbers may be given as a range.
Do I have to state the reason for the note?
In Saudi Arabia, yes: the reason is a mandatory field shown on the printout. In the UAE, yes: a brief explanation of the circumstances. Bahrain’s list of particulars and Oman’s article do not include it, and the tool only requires it where the text does.
Are credit note amounts written as negatives?
No. ZATCA’s e-invoicing standard requires every amount and quantity on the document to be positive; the document type — credit or debit note — carries the direction. ZATCA’s own sample credit note shows positive figures.
I issued more than one credit note against the same invoice. What do I enter as the original value?
The value after the previous note. The UAE Executive Regulation says so expressly, and it is what stops the same amount being credited twice anywhere.
Does a credit note have its own number series?
In Bahrain a sequential note number is a mandatory particular. The tool gives credit notes their own series, starting CN, so issuing one never leaves a gap in the invoice sequence.
Is my invoice or note data uploaded to a server?
No. Everything runs in your browser: the arithmetic, the PDF and the saved draft. Your customer’s name, your invoice numbers and the amounts are never sent anywhere, and there is no sign-up or email required.
This content is technical guidance and does not replace accounting or legal advice.