Debit Note in ERPNext
A Debit Note is a document issued by a buyer to a supplier to record a debit against goods returned to the supplier.
It is used to reduce the payable amount when goods are returned or when a purchase invoice needs to be partially or fully reversed.
A Debit Note ensures accurate accounting adjustment for returned goods and maintains correct supplier liability records.
Access Path
Home > Accounting > Accounts Payable > Purchase Invoice
Then: Create > Return / Debit Note
1. Prerequisites
Before creating a Debit Note, ensure:
- Purchase Invoice exists
- Supplier is created
- Items are properly recorded in the Purchase Invoice
2. How to Create a Debit Note
- Open the relevant Purchase Invoice.
- Click Create > Return / Debit Note.
- Supplier and item details will be fetched automatically.
- If payment was made, adjust via Payment Entry if required.
- Save and Submit the Debit Note.
3. Accounting Impact
A Debit Note reverses the accounting effect of the original Purchase Invoice.
- Supplier liability is reduced
- Expense or asset account is reversed
- Tax entries are adjusted accordingly
4. When to Use a Debit Note
- Partial or full return of goods to supplier
- Incorrect or damaged items received
- Adjustment without cancelling the original invoice
If no payment was made, the Purchase Invoice can be cancelled instead. Debit Notes are preferred for partial returns.
5. Example
A company purchases cotton worth ₹2400 + taxes from a supplier. On delivery, some goods are found damaged and returned. A Debit Note is created to adjust the supplier account.
6. Key Difference: Debit Note vs Credit Note
- Debit Note: Issued by buyer to supplier (purchase return)
- Credit Note: Issued by seller to customer (sales return)
7. Related Topics
- Payment Entry
- Purchase Invoice
- Credit Note
