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 validation, 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.
For stores still being planned, our ecommerce website design and development team builds refunds and e-invoicing into the checkout.
Frequently asked questions
Can I edit an e-invoice after LHDN validates it?
No. A validated e-invoice cannot be edited. You can cancel it within 72 hours, and after that you adjust it by issuing a credit, debit, or refund note.
What is the difference between a credit note and a refund note?
A credit note reduces what the customer owes on an e-invoice. A refund note records money actually paid back to the customer after the invoice was paid.
When do I issue a debit note?
Issue a debit note when the amount owed goes up: you undercharged and the customer pays the difference, or an extra item or service was added to the order.
Can I issue a note against an invalid e-invoice?
No. A note can only be issued against an e-invoice LHDN has already validated. If the original is still “Submitted” or was marked “Invalid”, fix and validate it first.
Do I need a refund note for an order in a consolidated e-invoice?
Not if the order is refunded in the same month, because the consolidated e-invoice records its final value. If the refund happens after the consolidated e-invoice was submitted, issue the refund note against it in the MyInvois portal.