A credit memo is used when a business has made an error. It's written when the invoice has already been sent to the customer. Sometimes the customer isn’t aware of the error, and the credit memo is their first notification. This is why it’s important to create a concise and user friendly document. The memo should explain any errors and that a credit has been posted to the company's account.
Create the header. Your header should clearly state the words "credit note" and have a reference number, date and customer name. The note should also be printed on company letterhead.
Create the body of the memo. The body of the credit memo should include an explanation of why the credit has been issued. This should include information about any pricing errors and the net amount owed to your customer.
Create a formal footer. A footer should appear at the bottom of the page. This is the section where you should include any special comments. An example would be that your company will deduct the credit during the next payment cycle.
Include contact information. Sometimes clients become confused when receiving a credit memo. Make sure to provide a contact name and phone number at the bottom of the memo.
Consider using software to create credit memos. If your company creates credit memos often, consider using software such as InstantInvoice 3 or Ezy Invoice 3000. These software programs offer credit memo creation tools as well as tracking features.