A credit memo is issued for a client to reduce the amount the client owes. There are a number of reasons why a credit memo might be issued, such as to give a discount, or if a contract was renegotiated.
Credit memos are typically used to reduce the balance owed on outstanding bills; they’re not sent to the client as a refund.
A credit memo can have one of three statuses, as displayed on the Billing > Transactions page:
There are two ways to issue a credit memo:
Then, hover over the icon located at the bottom, right-hand corner of the page, and select the Credit Memo icon (not the term ‘Credit Memo’).
Open or create a bill, and click Credit Memos > + CREDIT MEMO > + Credit Memo
A credit memo has two sections: Credits and Outstanding Bills. The Credits section list where you’ll add amounts that can be used to offset one or more bills.
Credit amounts can be:
To add amounts against the client, enter the amount in the blank row available by default.
To add amounts against particular projects:
A line for the project with an amount of 0 will display on the credit memo.
You can use the Outstanding Bills section of a credit memo to allocate the credit amount to unpaid or partially paid bills for the client.
The total amount you allocate must be less than the total amount of credit available in the credit memo. You can divide the credit among bills any way you choose.
You can leave an outstanding balance on the credit memo to be applied to bills later, if you like.