Credit note (kredītrēķins)

A credit note (kredītrēķins) is the document a seller uses to reduce or fully cancel the amount of an invoice already issued, for example after a discount, a return or a mistake. Under the VAT Law it is a tax invoice that amends the original invoice.

The VAT Law does not use the word "kredītrēķins". Section 125(5) instead says that any document which amends the original tax invoice and refers to it unambiguously counts as a tax invoice if it has the mandatory details. The amendment can also take the form of a simplified invoice that states the original invoice's date, number and the specific data being changed.

The seller reduces its output VAT by the amount credited, and a buyer that already deducted input VAT has to adjust it (Section 106 of the VAT Law). A discount granted after the goods or services were received reduces the taxable value.

An issued invoice is never deleted: the correction is a new, traceable document. The credit note gets its own number and the original invoice stays on file.