A self-billed credit note corrects a self-billed invoice — for example when an amount was overstated. Like the invoice, the customer raises it on the supplier’s behalf. It reverses the relevant VAT and reduces the balance owed to the supplier, and should reference the original invoice.
Key points
- Credit notes correct a self-billed invoice, not delete it.
- They reverse the relevant VAT and reduce the balance owed.
- They show as negative on a supplier statement.
When you need a credit note
Use a credit note to correct an error on a self-billed invoice, such as an over-charge or a cancelled supply. It’s the proper way to adjust — you don’t simply delete the original.
The VAT and balance effect
A credit note reverses the VAT on the amount corrected and reduces the balance owed to the supplier. On a statement it appears as a negative, netting against the invoices. Apex Billing supports self-billed credit notes with their own numbering.
This is general information, not tax advice — confirm your own position with your accountant or HMRC (see VAT Notice 700/62 on self-billing).