Two ways debit notes are used
The term “debit note” is used in two directions, and SmallKits supports both with one switch:
- We are charging a customer. You invoiced too little, or extra costs came up after the invoice (an express delivery, extra hours, a price difference). The debit note asks the customer to pay the extra, and the total is labelled “Amount due”.
- We are claiming from a supplier. A supplier short-delivered or overcharged you, or you returned goods. You send them a debit note to record the amount they owe you back, labelled “Amount claimed”. The recipient is shown as “Supplier”.
Switching direction after you start keeps everything you typed and only changes the wording.
What to include
- The title “Debit note”, a number (DN-0001…) and the date.
- The invoice it relates to, and that invoice’s date if you have it.
- The reason, in plain words.
- Each additional charge or claimed amount, with tax shown separately where it applies.
- A due date if you want payment by a particular day, and how to pay.
Debit note or a new invoice?
For a genuinely new sale, send a new invoice. A debit note is right when the extra amount belongs to a sale that has already been invoiced, so the paper trail shows one transaction and its adjustments. Many accounting teams prefer this, because it keeps the original invoice intact.
If you need to reduce an invoice instead, use the credit note generator.
Using debit notes with purchase orders
When goods arrive short or damaged against a purchase order, a debit note to the supplier records the claim. Note the purchase order number and the delivery note number in the reason, so the supplier can match it quickly.
Country notes
In India, a supplier issues a debit note under GST when the taxable value or tax charged was too low, and reports it in GST returns. In Kenya, VAT-registered businesses issue debit notes through eTIMS. In the UK and EU, an increase to an invoice is often handled with a supplementary invoice; a debit note referring to the original invoice serves the same purpose for your records.
Common mistakes
- Not referring to the original invoice, which makes the debit note hard to reconcile.
- Using the same number series as invoices. SmallKits keeps debit notes in their own sequence.
- Vague reasons. “Additional charges” is less useful than “Express delivery requested on 12 October”.
A worked example
A printing company quoted and invoiced a client for 500 brochures. Late in the job, the client asked for express delivery and a last-minute change to the cover, which required new plates. Rather than reissuing the invoice, the printer sends debit note DN-0007 against INV-0118: express delivery and replacement plates, with VAT, labelled “Amount due”, payable with the original invoice.
In the other direction, a restaurant receives 20 crates of tomatoes instead of the 25 it paid for. It sends the supplier a debit note against the supplier’s invoice for the 5 missing crates, labelled “Amount claimed”, and deducts the amount from its next payment.
Checklist before you send
- Did the customer or supplier agree to the extra charge or claim? Mention when.
- Is the original invoice number on the debit note?
- Have you added tax only where the original sale was taxable?
- Have you included how to pay, or how the claim will be settled?
Debit note terms explained
- Amount due
- What the customer owes you in addition to the original invoice.
- Amount claimed
- What a supplier owes you back, for example for short or damaged goods.
- Supplementary invoice
- Another name for a debit note that increases an invoice.
- Short supply
- Fewer goods delivered than were ordered and invoiced.
Good practice
- Agree any extra charge with the customer before sending the debit note.
- Attach evidence for supplier claims, such as the signed delivery note or photos of damage.
- Keep debit notes with the invoice they refer to.
Debit notes are numbered separately from invoices and credit notes (DN-0001 and so on), so each series stays unbroken. Change the prefix under Advanced settings if your accountant prefers another format.
Related free tools
- Free credit note generator: to reduce an invoice instead.
- Free purchase order generator: for the order behind a supplier claim.
Updated 2026-10-29