Credit Note vs Debit Note vs Refund Note (E-Invoice)
The difference between credit, debit, and refund notes under LHDN e-invoicing, when an online store needs each one, and the rule that applies to all three.
Once an e-invoice is validated by LHDN, you cannot edit it. If the amount changes afterwards, you issue a note against it. There are three kinds, and picking the right one depends on what happened to the sale.
The three notes in one sentence each
- Credit note: reduces or cancels part or all of an invoice — the customer owes less than the e-invoice says.
- Debit note: increases the amount of an invoice — you undercharged, or added items or services after the e-invoice was issued.
- Refund note: records money actually paid back to the customer after the invoice was paid.
Which one do I need?
| What happened | Note to issue |
|---|---|
| Customer returned an item and was refunded | Refund note |
| You gave a discount after the e-invoice was validated | Credit note |
| An item on the invoice was cancelled before payment | Credit note |
| You undercharged and the customer pays the difference | Debit note |
| An extra item or service was added to the order | Debit note |
The quick test: if money left your account and went back to the customer, it is a refund note. If only the amount owed changed, it is a credit note (down) or a debit note (up).
The rule that applies to all three
A note can only be issued against an e-invoice LHDN has already validated. If the original e-invoice is still “Submitted” or was marked “Invalid”, there is nothing to attach a note to — fix and validate the e-invoice first.
Cancel or issue a note?
Within 72 hours of submission, you can simply cancel a validated e-invoice instead of issuing a note — useful for mistakes caught quickly. After 72 hours, cancellation is no longer possible, and a note is the only way to adjust it. For a refund after the 72 hours, issue a refund note for the refunded amount.
Orders without an individual e-invoice
Most online orders are reported in the monthly consolidated e-invoice. If such an order is refunded in the same month, the consolidated figure just records its final value, and no note is needed. If the refund happens after the consolidated e-invoice was submitted, issue the refund note against that consolidated e-invoice in the MyInvois portal.
How it works in practice
In an e-invoice app, the steps are usually the same for all three notes:
- Open the order or the e-invoice listing and find the validated e-invoice.
- Choose Credit, Debit, or Refund Note.
- Enter the amount and confirm.
- Submit, and wait for LHDN to validate the note.
Our e-invoice integrations for Shopify, WooCommerce, OpenCart, and Shopline support all three note types from the order page.