Debit Note Template
A debit note (or debit memo) increases the amount a customer owes. It is used when the original invoice understated the charge — for example, unbilled hours, extra materials, or a price correction. Like a credit note, it references the original invoice so both sides can reconcile their books.
When to use this
- When you discover unbilled work or materials after invoicing
- When a pricing error meant the customer was under-charged
- When additional costs arise on a project already invoiced
- When freight, duties, or handling charges were missed on the original invoice
- When contract terms allow extra charges the invoice did not include
Key fields to include
- Debit note number and date of issue
- Reference to the original invoice number being increased
- Clear explanation of why the additional amount is owed
- Line items with the additional charges
- Total additional amount and currency
- Payment terms and due date for the extra amount
Frequently asked questions
When should I use a debit note instead of a new invoice?
Use a debit note when the extra charge relates to an already-issued invoice and you want the paper trail to stay linked. A new invoice works too, but a debit note makes the correction and its reason explicit.
Can a customer dispute a debit note?
Yes, a customer can question any debit note. That is why the reason for the increase should be documented clearly and backed by your contract or agreed rates. Discussing the charge with the customer before issuing it usually prevents disputes.
Does a debit note affect tax?
A debit note increases the taxable amount, so it generally increases the tax due for both parties. Treat it as a tax-relevant document and report it in the correct tax period according to your local rules.
More use cases
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