Credit Note

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Comments

  • arsenarsen Member Posts: 3

    Hi Wave team, I've been following this thread for over a year now. I really admire the application and it's ease of use, I find it is everything quickbooks is meant to be but done right. As many people have stated, Credit notes are a crucial and essential feature. Not having this is like having a store with no return policy.

    For a year now Wave admins have been saying they will be taking this up to the product team but still no result. I am not able to successfully migrate books since this is missing. The patches recommended all produce a an undesirable side effect.

    As Wave keeps striving on the best overall solution on the market, workarounds seem to make the product less than desirable and prevent me from recommending it to others.

    I hope you guys can raise some flags ASAP because I would love to start migrating and accepting payments online using wave.

    Best!
    Arsen H.

  • JamieDJamieD Administrator Posts: 1,119 admin

    Thanks for your input here @arsen. We are currently exploring the possibility of creating a new, more dynamic Customer section in Wave. We still do not have any immediate plans of improving this directly, with the added functionality of a Credit Note. Stay tuned for more updates, we will definitely let our users know in this thread when/if this becomes a feature we release.

  • NeilRNeilR Member Posts: 14

    +1 for a credit notes - such a standard and commonly used function - yet missing. I have an invoice from last financial year. Last year's accounts have been finalised and submitted to the Tax Office. The client has sent a request and the needs less services. I can't just alter last years invoice. It should however just be a simple matter of issuing a credit note in this financial year.

    I've forgiven Wave some issues up until now:

    • the upgrade that removed a function i used regularly leaving me with a workaround that creates more work.
    • the time i tried to import 365 days of personal transactions into the personal account and wave decided to import some of them into the business account and some into the personal account, requiring days of my time to go through 12 months of transactions and categorize them
    • The discovery 2 weeks ago that the software upgrade erroneously re-dated some of my transactions to a previous financial year, before I even opened the business bank account, which put my balance sheet and P&L out after they were signed off in FY18. That's cost 3 days of my time and my accountants to rectify by going through transactions line by line - my accountant is not free and it causes issues with audit trails and tax office reviews.

      Its not enough to say its 'not on our road map' or 'here's a workaround'. Locking previous years accounts and allowing credit notes are such basic, standard functions for any accounting software. As a company director I am legally liable for the truthfulness of my accounts and can face huge penalties and sanctions from various authorities for getting it wrong. The ramifications of getting it wrong can be serious for me and my accountant. I'm in the process of investigating alternatives having discovered that you can't do credit notes. I just can't risk it anymore.

    Like others, I also find it strange that you don't consider getting the basics right a priority. Perhaps your product team should revisit Wave's core belief #4, as you aren't even reaching industry standards yet:

    4: Reinvesting in our products
    We are relentlessly unsatisfied with the status quo and obsessively work to raise the bar on industry standards. It’s in our DNA to continuously push the boundaries of what’s possible, so that we can introduce innovative solutions that better anticipate your needs and make managing your finances easier.

  • BarsinABarsinA Administrator Posts: 462 admin

    Hey there @NeilR

    There's no doubting what you're saying is correct in that our free accounting software needs some work in order to hit the industry standards for people whose books are more complex. I just want to add however that the goal has always been to give back to the small business owner, whose needs are perhaps a little simpler when it comes to their bookkeeping. This of course is a good sign for your business, as it tells us that you've grown and that you require more from an intro level accounting software. So look at this as a plus. I appreciate your feedback and we apologize for any erroneous transactional data which may have show up in your account.
    We've operated for the small business owner whose transactional data is a little less robust (perhaps) than yours and the needs of some other business owners. But with that being said we are currently working on the back end of the invoicing so that we can begin introducing new features. We appreciate your business with us, and also your feedback. Hope you have a great weekend.

  • MerlinAccounts_UKMerlinAccounts_UK Member Posts: 177 ✭✭✭

    The only way you can "ignore" credit notes is if you are operating on, and reporting by, cash basis alone. The minute you start using a Sales and Purchase ledger - which Wave doesn't discourage (creation of customer accounts = Sales Ledger) then you MUST have a facility to create/enter credit notes - the size of the business is irrelevant, the existence of customer accounts makes it a basic necessity. If you do not want to have a credit note function you need to turn Wave into a cash receipts and payments product only!

  • SanderSander Member Posts: 1

    I have to echo what Andrew said. The use of credit notes has nothing to do with the size of somebody’s business. Anybody could have the need to provide a credit to a customer, and it’s a basic function of accounting that I had no idea was missing from Wave when I started using it. This really needs to be made a high priority.

  • AlarmManAlarmMan Member Posts: 2

    I joined just to say credit notes are fundamental to my accounting. I invoice customers for services, if they don’t pay the bill, no service, but I then need to cancel the invoice. So PLEASE prioritise this.

  • MyronMyron Administrator Posts: 143 admin

    Hi @Sander @AlarmMan , thank you for jumping in to share your feedback on this. Sharing your thoughts on this in the community helps to increase the visibility of this feature request. We appreciate you all sharing a bit about your business and your individual use cases for credit notes.

    @AlarmMan , in the situation you are describing, would writing off those invoices as bad debt be an option for you? We do have a handy Help Centre article to help with doing this:

    https://support.waveapps.com/hc/en-us/articles/115000031243-Dealing-with-bad-debt-How-to-write-off-an-invoice

  • AlarmManAlarmMan Member Posts: 2

    Hi Myron,

    Thanks for the comment. But its not bad debt., and it would make the figures wrong. I have virtually no bad debt, and it might take 2 or 3 years but I normally get paid eventually. This is an invoice I raised for providing a service, that service was never provided and the customer no longer wants it. Ie Annual Alarm maintenance, but the customer has sold the house. No problem raise a credit note and there is no income or loss. I hope that helps explain one of my use cases.

    I like to think of myself as a nice guy, and tell my customers, if you dont want it any more just dont pay. But if you ask for help afterwards its not at the same rates. Their choice.

    I also provide vpn for ex-pats to get Uk TV in France. Same thing, not paid no service (they tend to pay quickly once cut off), but sometimes they just needed it for a rental, I raise the invoice, not paid, cut them off, no harm, no foul, just an unpaid invoice... (I raise the invoices on the 25th cutting off service on the 1st.).

    I Love Wave otherwise, and its integration with Stripe makes getting paid really easy.

    Cheers,
    Andy

  • MerlinAccounts_UKMerlinAccounts_UK Member Posts: 177 ✭✭✭

    @AlarmMan

    Looking how you describe your invoicing strategy I'd be inclined to say what you are actually doing is issuing Pro-Forma invoices - a pro-forma is an invitation to accept the goods/services offered at the price stated thereon, the goods/services only been supplied at the point of delivery. This is actually when your income arises, not when you issue a pro-forma. In your situation I'd be inclined to suggest that you've probably been accounting for income based on unpaid pro-forma's, meaning you are paying tax where you shouldn't have done, and VAT before it became due.

    Working within the strictures of Wave I'd actually recommend that your Pro-Forma's are issued using Estimates (you can call it a Pro-Forma when you are creating) - and only when you get paid do you then create an invoice for the work.

  • TJ_in_ZATJ_in_ZA Member Posts: 16

    No facility to create a credit note!

    I'm astonished!

    Credit notes are an absolute fundamental feature of even the most basic accounting systems.

    I see that this discussion has been going on for literally years and still there's no credit note functionality. Crazy.

    It's also essential to be able to provide a Sales Tax Audit Report, something that is missing from Wave.

    Another glaring omission is the ability to have a discount column on invoices to allow for discounts to be applied on a line-by-line basis.

    TJ

  • ChelseaKChelseaK Administrator Posts: 264 admin

    @TJ_in_ZA Thanks for weighing in on the credit note feature request, and, like Barsin mentioned a few comments above, there's no doubt that you have a point!

    As for a Sales Tax Report, we certainly do have that. Head to Reports > Sales Tax Report and you can see all your Tax Amount on Sales and all your Tax Amounts on Purchases.

    Also, we do agree that a discount feature is essential for invoices. Adding a discount functionality is on our product roadmap and this update is on the way! In the meantime, you can add a negative line item on an invoice as a workaround for adding a discount. For example, if you would like to discount the invoice by $10.00, you can add $-10.00 as a line item titled 'Discount' on your invoice. Hope this helps in the meantime, TJ!

  • WaxwingWaxwing Member Posts: 3

    I have to agree, a credit note feature really needs introducing. I run a very simple, small consulting business. A client mistakenly sent me a payment, which I hadn't invoiced them for, and I need to return, so issue a credit note is the right thing to do.

  • AmandaKAmandaK Administrator Posts: 70 admin

    @Waxwing Appreciate you chiming in and sharing how credit notes would be useful for your consulting business! Our product team is constantly monitoring our online community forum and having customers share use cases is super helpful for them.

  • TJ_in_ZATJ_in_ZA Member Posts: 16

    Can anyone explain to me a workaround for the lack of a credit note feature.

    I issued an invoice to a client in a previous financial period, which has only been partially paid do far.

    Now, in the current financial period, I need to pass a credit note against part of the remaining balance of that invoice.

    How on earth do I do that without a proper credit note facility?

    There must be a workaround, even if it involves entering multiple transactions, but I' cant figure out how to do it.

    The value of this free accounting system is rapidly being overtaken by the huge extra amounts of work it creates because of missing basic features.

    If anyone can explain how to solve my problem I'd love to her from you.

    Thanks,

    TJ

  • JamieDJamieD Administrator Posts: 1,119 admin

    Hey @TJ_in_ZA. Although maybe not ideal for you -- but what's most likely the best workaround option for you is what's followed in this article: https://www.cloud-book.co.uk/wave/wave-online-accounting-credit-notes/ -- this article is a workaround from our legacy software, but it essentially works the same in the most recently updated version as well.

    "To post a credit note on Wave, you have to create a new invoice with negative amounts.

    Then to allocate the credit note against the invoice, you need to create a positive income transaction and a negative income transaction in the bank account. Both amounts need to be for the total credit value, so that they offset each other in the bank account and don’t change the bank balance. Then you need to allocate the positive receipt against the invoice, and the negative receipt against the credit note."

    Hope that helps.

  • TJ_in_ZATJ_in_ZA Member Posts: 16

    @JamieD said:
    Hey @TJ_in_ZA. Although maybe not ideal for you -- but what's most likely the best workaround option for you ...

    Hi Jamie,

    Thanks very much for your post and advice.

    Although it's a cumbersome workaround it does seem to work and it will have to do until the Wave developers add a real credit note facility.

    TJ

  • CassCass Member Posts: 1

    Hello,

    I've read many discussions about the lack of a credit note feature.Please could someone explain how I get over the following issue.

    I have a client who paid their deposit invoice in a previous VAT period. Subsequently they have been in touch to say they qualify for 5% VAT rather than the usual 20% VAT which was on the previous invoice.

    I thought I could issue a credit note for the whole invoice and reissue with 5%, but this doesn't seem possible. They have to pay a balance invoice next week so I can issue that invoice at 5% VAT but I still need to find a way to make the previous amount have 5% VAT.

    Thanks in advance.

  • MerlinAccounts_UKMerlinAccounts_UK Member Posts: 177 ✭✭✭

    Have you verified that they are right in their contention that you should have charged 5% VAT? The onus is on you to be able to prove you charged the correct VAT rate if challenged by HMRC. I know this isn't answering the credit note issue but just wanted to make sure you weren't simply acting on the instruction from your customer alone.

    There has been a recent post by one of the admins for a convoluted work around on credit notes that you probably need to follow to achieve the result you need.

  • CassCass Member Posts: 1

    Thanks Andrew, yes I've checked and they do qualify.

    I'll track down the post.

    Many thanks

  • BarsinABarsinA Administrator Posts: 462 admin
  • FAWFAW Member Posts: 2

    I am actually totally stunned that a program which calls itself an accounting package, does not have a credit note feature. It is such a common practice in bookkeeping to be able to apply a credit to an invoice, one amount getting taken off the other. This is very much an essential item for accounts receivable. It is ridiculous that it is still not available.

  • fredbadfredbad Member Posts: 2

    Please add me to the CREDIT NOTE IS A MUST gang. A credit note feature would be really useful to me - a very small business. Small businesses like me do not have a department that can spend time doing several workarounds to achieve an almost-similar effect but which produces another anomaly in the end-of-year accounts. We are generally so busy trying to survive that our love of Wave is because it does things so well and doesn't make us jump through hoops. Thank you so much for the excellent FREE software, please, please, please help us a bit more and provide the credit-note feature to make it even more excellent.

  • EmmaPEmmaP Administrator Posts: 236 admin

    Hey @fredbad, thanks for taking the time to provide your feedback about this. Your request has been noted! Wave is aimed to help small business owners like you take on the accounting world. I can see how having a credit note feature would be helpful to keep everything streamlined in your books, and take less time away from your business! I'm glad to hear you are enjoying Wave otherwise :)

  • MindplayMindplay Member Posts: 2

    Without some way to have a credit note or similar facility, i end up with Credit Card account that is a clearing account. For example, I got paid for some work by wire transfer. The client sent the amount of the invoice (let's say it's $1000). Their bank kept $20, and sent my bank $980. Of course, since it's a bank, they kept another $20. Leaving me with $960.

    Now, I have a $980 deposit, so I apply that against the invoice. (I take the $20 withdrawl and post it to the Bank Charges Category). But now what thinks the invoice is still overdue for $20.

    There are no good options. I could:
    1. Demand the client pay another $20
    2. Edit the invoice -- but that's not correct and would make any reprints or statements wrong on their end
    3. Record the payment as $1000 but then be out $20 reconciling my bank account.

    I would normally (pre-wave) issue a credit note. Because this makes the point to the customer that I'm eating their bank fees.

    What I do now is post a payment to as if it went on to the fake credit card, and then post a less-fake expense to the same credit card. It's not totally the right way to do it, but I can live with it.

  • BarsinABarsinA Administrator Posts: 462 admin

    Hey there @Mindplay

    I just replicated your scenario in my test Wave account and realized the wall you're hitting. Thanks for giving us more context as to why you would need this feature. I apologize if this makes your accounting a bit more cumbersome. I'm curious if you are able to use any of the methods in this article on writing off (just part of) your invoice. This article -->HERE<-- discusses writing it off as bad debt, but you would likely just name your stand-in bank account additional bank charges or something along these lines.

    Let us know if this would be a viable option for you as well.

  • CRJCRJ Member Posts: 0

    Hello
    I manage an import/export company and this example happens all the time: a customer receives a container costing them $1000, they receive the container, however some items broke in the container, so i issue a $50 refund/credit. How do I issue a credit to an invoice and have it register on the invoice and be able to track the total credits issued? I understand I could just go into the invoice and adjust it as a line item, but then I would not be able to track the total credits for the years or have it show up on my P&L. I could do a journal entry but then it would not be reflected on the invoice, since there is not way (that i know of) to link a journal entry as an invoice payment, so i would have outstanding invoices. Lastly, i do not want to do both because the credit would be hitting A/R twice. Any suggestions would be helpful.

    edited November 14, 2019
  • EmmaPEmmaP Administrator Posts: 236 admin

    Hey @CRJ! Thanks for reaching out! I've merged your post with a thread about credit notes here. We currently do not have a feature that allows you to create credit notes in Wave, but it is a common request. You can read through the pages of this thread to see what other users are doing to account for credit notes in Wave. Hopefully one of the workarounds here will work for you at the moment!

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