Self-Billed Credit Note
A Self-billed Credit Note (SBCN) is a document that you create on behalf of a vendor to reduce or cancel the amount payable for a previously issued self-billed invoice.
When the payable amount needs to be reduced or the transaction is cancelled, you must create a self-billed credit note instead of a vendor credit.
Scenario: Zylker has a self-billing agreement with a foreign vendor. After raising a self-billed invoice, Zylker discovers that the delivered quantity was lower than invoiced. They create a self-billed credit note to reduce the payable amount, keeping the records compliant with their self-billing arrangement.
When to Create a Self-Billed Credit Note
You can create a self-billed credit note when:
- The original self-billed invoice contains an excess amount.
- The quantity or value of goods or services needs to be reduced.
- A transaction needs to be partially or fully cancelled.
- A subsequent adjustment reduces the amount payable to the vendor.
Note: If you need to increase the amount payable for a self-billed invoice, create a Self-Billed Debit Note instead.
Vendor Credit vs Self-Billed Credit Note
In Zoho Books, both vendor credits and self-billed credit notes can reduce the amount payable to a vendor. The transaction you create depends on whether you received a vendor credit from your vendor or you need to issue a self-billed credit note on behalf of your vendor.
- A Vendor Credit is a document you record when your vendor issues a credit against a bill.
- A Self-Billed Credit Note is a document you create on behalf of your vendor to reduce the amount payable for a self-billed invoice.
Enable Self-Billed Credit Notes
Before creating self-billed credit notes, you must enable it in the settings. Here’s how:
- Go to Settings.
- Navigate to Organization settings, and select General under Setup & Configurations.
- In the General tab, under Select the modules you would like to enable, select Self-Billed Credit Notes.
- Click Save.
Self-billed Credit Notes will be enabled for your organization.
Create a Self-Billed Credit Note
From Vendor Credits
You can create a self-billed credit note from the Vendor Credits module. It is recorded as a vendor credit and can be applied to a self-billed invoice or a bill, or refunded if required.
- Go to Purchases and select Vendor Credits.
- Click the dropdown next to + New, and select Create Self Billed Credit Notes.
- In the New Self Billed Credit Note page, fill in the following details:
| Fields | Description |
|---|---|
| Vendor Name | Select the vendor on whose behalf this self-billed credit note is being raised. |
| Location | Choose the location you want to associate with this transaction. |
| Credit Note # | The credit note number is auto-generated based on the selected Transaction Series associated with the location. Click the Gear icon to configure whether you want to enter self-billed credit note numbers manually or generate them automatically. |
| Order Number | Enter an order number for reference, if applicable. |
| Vendor Credit Date | Select the date on which this self-billed credit note is issued. By default, the current date is auto-filled. |
| Subject | Enter a subject or brief description for this self-billed credit note. |
| Accounts Payable | Select the accounts payable account to which this self-billed credit note should be recorded. |
| Warehouse Location | Select the warehouse location associated with the items in this self-billed credit note. The available warehouse locations are based on the selected location. |
| Selection Type | Select how you want to add items to the self-billed credit note. Choose Single Location to select items from one location, or Multiple Location to select items from multiple locations. |
| Item Tax Preference | Select whether the line item rates in the self-billed credit note are Tax Inclusive or Tax Exclusive. |
| Discount Type | Choose how you want to apply the discount At Transaction Level or At Line Item Level in the self-billed credit note. |
| Bulk actions | Choose this option to update multiple line items at once. Select Bulk Update Line Items from the dropdown, select the required line items, and then click Update Reporting Tags to update the reporting tags for the selected line items. You can also select Show All Additional Information to select a project and associate reporting tags for each line item individually. |
| Item Details | Enter or select the items from the dropdown for which you want to record the credit. |
| Account | Select the expense or purchase account to which each line item should be recorded. |
| Quantity | Enter the quantity of items being credited in this self-billed credit note. |
| Rate | The rate is automatically filled based on the rate set for the item. Enter a custom rate manually if required. |
| Tax | Select the applicable tax rate for the line item. |
| Amount | Displays the calculated amount for each line item based on the quantity and rate. |
| + Add New Row | Click this option to add a new line item row. |
| + Add Items in Bulk | Select this option to add multiple items at once. In the Add Items in Bulk popup, select the items, enter their quantities, and click Add Items. |
| Sub Total | Displays the sum of all line item amounts before discounts and adjustments are applied. |
| Discount | Enter a discount amount or percentage to reduce the total credit amount. Click Apply After Tax to apply the discount after the tax is calculated. |
| Discount Account | Select the account used to track the discount applied to this self-billed credit note. This field appears when a discount is entered. |
| Adjustment | Enter an adjustment amount to adjust the total. Use a (+) sign to increase the total and a (-) sign to reduce it. Click Configure Account, select an adjustment account to record the adjustment amount, and click Update. |
| Total | Displays the final credit amount after applying taxes, discounts, and adjustments. |
| Notes | Enter any internal notes or remarks you want to record against this self-billed credit note. |
| Attach File(s) to Self Billed Credit Note | Click Upload File to attach supporting documents to the self-billed credit note. You can upload up to 5 files, with a maximum size of 10 MB per file. |
- Click Save as Draft to save the self-billed credit note as a draft, or click Save as Open to record it as an open credit.
From a Self-Billed Invoice
You can also create a self-billed credit note from a self-billed invoice. Here’s how:
- Go to Purchases and select Bills.
- Select the self-billed invoice for which you want to create a self-billed credit note.
- Click the More icon and select Create Self Billed Credit Note.
- In the New Self Billed Credit Note page, the self-billed invoice details are pre-filled. Review and update the fields as needed.
- Click Save.
A self-billed credit note will be created for the self-billed invoice in Closed status, and the vendor credit will be automatically applied to the self-billed invoice. The status of the self-billed invoice will change to Partially Paid or Paid, depending on the credit amount.
From a Bill
You can also create a self-billed credit note directly from an existing Bill when you need to reduce the amount payable as a part of self-billing arrangement. Here’s how:
- Go to Purchases and select Bills.
- Select the bill for which you want to create a self-billed credit note.
- Click the More icon and select Create Self Billed Credit Note.
- In the New Self Billed Credit Note page, the bill details are pre-filled. Review and update the fields as needed.
- Click Save.
A self-billed credit note will be created for the bill in Closed status, and the vendor credit will be automatically applied to the bill. The status of the bill will change to Partially Paid or Paid, depending on the credit amount.
View Self-Billed Credit Notes
The Self-Billed Credit Notes are listed within the Vendor Credits module along with vendor credits. A self-billed credit note icon appears next to the document number to help you distinguish self-billed credit notes from regular vendor credits.
- Go to Purchases and select Vendor Credits.
- Select the desired self-billed credit note that you want to view.
Filter Self-Billed Credit Notes
You can use the custom view in the vendor credits list to filter and view only self-billed credit notes. Here’s how:
- Go to Purchases in the left sidebar and select Vendor Credits.
- Click the view dropdown at the top of the list (it shows the current view name, such as All Vendor Credits).
- Select Self-Billed Credit Notes from the list of available views.
The list will now display only self-billed credit notes, making it easy to review and manage them separately from regular vendor credits.
Note: Advanced search does not support filtering exclusively for self-billed credit notes. Hence, use the self-billed credit notes custom view to filter self-billed credit notes records.
Self-Billed Credit Note Reports
Self-Billed Credit Notes follow the behaviour of vendor credits and are included in the Payables Reports in Zoho Books. You can use these reports to review the credit amounts recorded through self-billed credit notes alongside your regular vendor credits.
To view Payables Reports:
- Go to Reports in the left sidebar.
- Under Report Category, select Payables.
- Under Payables select the report you want to view.
The following payables reports include self-billed credit note data:
- Vendor Balance Summary
- AP Aging Summary
- AP Aging Details
- Vendor Credit Details
Self-Billed Credit Note PDF
Self-Billed Credit Notes use the Vendor Credits template. When you generate the PDF, Zoho Books changes the document title on the printed PDF to Self-Billed Credit Note to comply with self-billing regulations. The remaining layout and details follow the vendor credits template.
Yes