Debit note
A debit note is a document a buyer sends a supplier to record a reduction in what is owed, usually for returned or damaged goods.
A debit note is usually issued by a buyer to a supplier, to say that the buyer is reducing the amount owed. Common reasons are returned goods, damaged goods, short delivery or a price higher than agreed. It is the buyer's version of the credit note the supplier issues for the same adjustment.
Some businesses also use the term when a seller charges a customer extra after an invoice, for example for freight that was left off. The common thread is that a debit note adjusts an earlier invoice.
Example
A wholesaler in Karachi buys 50 bags of rice at Rs 9,000 per bag, a bill of Rs 450,000. When the bags are unloaded, 2 are torn and wet. He sends the supplier a debit note for 2 × 9,000 = Rs 18,000 and returns the bags.
| Amount | |
|---|---|
| Supplier's bill | Rs 450,000 |
| Debit note for 2 damaged bags | − Rs 18,000 |
| Amount payable | Rs 432,000 |
Why it matters
- The supplier's ledger shows the correct amount payable.
- There is a written record if the supplier later disputes the deduction.
- Stock records match the goods actually kept.
Recording damage on the goods received note at delivery makes the debit note easy to justify.
How software handles it
In trading software, a purchase return is entered against the supplier, reducing both stock and the accounts payable balance in one step. Taajir records purchase returns with credit notes from the supplier and keeps purchases, payments out and supplier ledgers together.
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