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Credit Note in compliance with UK VAT legislation

  • Edith Karnitsch shared this idea 9 years ago
  • Payments/Billing
  • 55 Comments


334 Votes
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The refund functionality in WHMCS 5.3.13 is not on accordance with UK legislation.

When a refund is issued, the system must generate a Credit Note with the following details:
  • be headed ‘credit note’ or ‘debit note’ as appropriate and show clearly all the following details:
  • the identifying number and date of issue
  • the name, address and registration number of the supplier
  • the name and address of the customer
  • the reason for its issue - for example, ‘returned goods’
  • a description which identifies the goods or services for which credit is being claimed or allowed
  • the quantity and amount for each description
  • the total amount credited, excluding VAT
  • the rate and amount of VAT credited
  • the number and date of the original VAT invoice - if you cannot do this (for example, because returned goods cannot be identified with a particular invoice), you must be able to satisfy us by other means that you accounted for VAT on the original supply

Reference: https://www.gov.uk/government/publications/vat-notice-700-the-vat-guide/vat-notice-700-the-vat-guide#credits-and-debts

The current system of issuing a revised invoice contravenes UK VAT legislation and makes WHMCS unusable for UK VAT purposes when it comes to refunds.

The main issue I can see is that currently the date of the refund is not recorded as separate entry, neither is the reason for the refund nor is a unique number applied. The renaming of the document to "Credit Note" should be straight forward.
Merged Ideas
    Issue a credit note for unpaid invoice.
    I have an unpaid invoice that i want to cancel, my accountant is telling me that i can't canceled an electronic invoice and that i need to issue a credit note with the exact amount in order to cancel an invoice.This functionality is not something that is currently offered by WHMCS.I'm sure that this is something that every one need and it's defiantly need to be offered by WHMCS.If any one know a temporary salution it will be great, thanks.

60 Comments

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Stephanie Hope commented 2nd September 20
If this has been 'planned' for 4 years I doubt adding another comment will make a difference, but this is also an accounting/legal requirement in New Zealand.
Antonio Pavón commented 20th August 20
This procedure is similar in Spain. It is necessary!
Peter Kuipers commented 29th July 20
You are thinking?
Bhavesh Raja commented 29th July 20
This been planned for 5 years :) WHMCS v8 is on its way maybe we can expect something new?
Zaid Bester commented 8th May 20
I am not sure if this will help as it's been 4 years since this was logged but is an urgent request from our billing department
Bence Bokor commented 6th May 20
In planned for years, still no news? Guys, we need this!
Karl Prust commented 23rd April 19
And them being a UK company as well!
Arthur Jansen commented 23rd April 19
I think it's save to say that WHMCS isn't really bothered by this... since they haven't added it in the 3 years we are requesting it.
ghislain commented 10th April 19
i really need credit note or negative bills like it was before. In France too we cannot just mess with existing invoices and change them. Invoice cannot be change when done. If you refund one you have to issue credit note. We used negative invoices but now it is Forbidden...
whatever commented 22nd September 18
currently there is no reversed invoice in whmcs.
however a reversed invoice would be fine IF theres a reference to the original invoice and a reason.
however there needs also to be an transaction which is impossible in whmcs currently because negative transactions are not allowed (for no reason at all)
the correct way would be in case of a payment already odne to an invoice:
original invoice #100 - 500€ total.
transaction - payed by paypal 500. 1.1.2018
creditnote/reverse invoice #101 as described negative amoutns are totally fine amount: -500
transactions:
2.1.2018 payed to refundaccount / credits (in some legislations this has to be paypal)
notice that refund does not take place on the first invoice. the first invoice is with issuing and the transaction complete.
it cant be undone. refunding would be a new agreement covered with the creditnote. the payment for this is also only related to the new agreement.
also be aware it touches then credits which are a problem in itself.
as of 1.1.2019 every EU country has to handle credits without VAT and is not to be taxed until its used.
they have to be hold kinda like a bank or trust. (keeping those funds on behalf of the customer)
so best would be if credits are used just as any other payment method as a transaction. then we could use creditnote payments directly to credits - credit to paypal and vice versa and so on.
Jonathon Lucas commented 20th September 18
WHMCS, any chance of an update on this?
mscholten commented 15th September 18
Note this isn't only UK VAT legislation, this is a European rule. For a UK company (as far as I know WHMCS is still a UK Limited) I would expect to at least follow local laws...
WHMCS-addons.eu commented 11th September 18
Any udpate on this from WHCMS????
Pat Sanders commented 26th August 18
Wondering the same here, 2 years is a long time for something which is not optional but should be in any billing system.
Bhavesh Raja commented 2nd May 18
Hello,

This is not only very unfortunate but also sad when I notice this request is over two years old!
The status of this seems to be in "Planned" state but may I kindly request WHMCS to inform of what is planned and WHEN.
To be compliant with billing is a core feature and would not be something you should purchase a module for.

Thanks!

Kind regards,
Bhavesh