Debit Note Generation

Debit Note Generation

Debit notes in EquiBillBook are automatically generated when you create purchase returns. A debit note is a document that indicates the amount owed to you by a supplier, typically used when returning goods or adjusting purchase amounts. This guide explains how debit notes work in the purchase return process.

What is a Debit Note?

A debit note is a commercial document issued by a buyer to a supplier:

• Purpose: Indicates that the supplier's account has been debited (reduced) due to a return or adjustment
• Legal Document: Serves as proof of return and adjustment for accounting and tax purposes
• Accounting Entry: Records the reduction in accounts payable to the supplier
• Tax Compliance: Required for GST/VAT compliance in many jurisdictions

Automatic Generation

When you create a purchase return in EquiBillBook:

1. A debit note is automatically generated upon saving the return
2. The debit note number is assigned based on your numbering rules
3. The debit note is linked to the original purchase bill
4. All return details are included in the debit note
5. The supplier's account is automatically debited

Debit Note Details

Each debit note includes the following information:

• Debit Note Number: Unique identifier for the debit note
• Date: Date of the purchase return
• Supplier Information: Name, address, and contact details
• Original Purchase Bill: Reference to the original purchase invoice
• Returned Items: List of items being returned with quantities and prices
• Subtotal: Total value of returned items
• Discount: Any discounts applied
• Tax Details: Tax breakdown (CGST, SGST, IGST, etc.)
• Grand Total: Total debit amount
• Return Reason: Reason for the return
• Notes: Additional information about the return

Debit Note Numbering

Debit note numbers are generated based on your system settings:

• Prefix: Custom prefix can be configured (e.g., "DN-", "DR-")
• Numbering Sequence: Sequential numbering or custom format
• Financial Year: May include financial year in the number
• Branch-specific: Different numbering for different branches if applicable

Linking to Purchase Bill

The debit note is automatically linked to the original purchase bill:

• Purchase Reference: The original purchase bill number is referenced
• Item Mapping: Each returned item is linked to its original purchase item
• Amount Reconciliation: The debit note amount reduces the payable amount
• Payment Adjustment: The debit note can be used to adjust supplier payments

Supplier Account Impact

When a debit note is generated:

• Accounts Payable: The supplier's payable amount is reduced
• Payment Due: The amount due to the supplier is automatically adjusted
• Outstanding Balance: The supplier's outstanding balance is updated
• Payment History: The debit note appears in supplier payment records

Viewing Debit Notes

You can view debit notes in several ways:

1. From Purchase Return: View the debit note directly from the purchase return details
2. Supplier Statement: Debit notes appear in supplier account statements
3. Reports: Access debit note reports from the Reports module
4. Purchase Return List: View all debit notes from the purchase return listing

Printing Debit Notes

To print a debit note:

1. Navigate to the purchase return details
2. Click the "Print" or "Print Debit Note" button
3. Select the debit note template (if multiple templates are available)
4. Preview the debit note before printing
5. Print or save as PDF

Emailing Debit Notes

To email a debit note to the supplier:

1. Navigate to the purchase return details
2. Click the "Email" or "Send Debit Note" button
3. Enter the supplier's email address (if not pre-filled)
4. Customize the email message if needed
5. Send the debit note via email

Debit Note Templates

Debit notes can be customized using templates:

• Template Selection: Choose from available debit note templates
• Customization: Customize templates with your logo and branding
• Fields: Include or exclude specific fields as needed
• Layout: Adjust the layout and formatting

Tax Compliance

Debit notes are important for tax compliance:

• GST/VAT: Required for GST/VAT returns and compliance
• Input Tax Credit: Adjusts input tax credit when goods are returned
• Tax Reporting: Included in tax reports and filings
• Audit Trail: Provides audit trail for returns and adjustments

Editing and Cancelling Debit Notes

Debit note management:

• Editing: Edit the purchase return to modify the debit note (before finalizing)
• Cancelling: Cancel the purchase return to void the debit note
• Reversal: Cancelling a return reverses the debit note and restores stock
• Status Tracking: Track debit note status (Draft, Final, Cancelled)

Multiple Debit Notes

You can create multiple debit notes for the same purchase bill:

• Partial Returns: Create separate debit notes for different return batches
• Item-wise Returns: Return different items at different times
• Tracking: System tracks total returned amount per purchase bill
• Reconciliation: All debit notes are reconciled against the original purchase

Debit Note Reports

Access debit note information through reports:

• Purchase Return Reports: View all purchase returns and their debit notes
• Supplier Reports: See debit notes in supplier-wise reports
• Tax Reports: Include debit notes in tax-related reports
• Financial Reports: Debit notes appear in accounts payable reports

Best Practices

• Always review the debit note before finalizing the purchase return
• Ensure debit note numbers follow your numbering sequence
• Keep copies of all debit notes for record-keeping
• Send debit notes to suppliers promptly for faster reconciliation
• Verify tax calculations on debit notes match your tax structure
• Use debit notes to maintain accurate accounts payable records
• Reconcile debit notes with supplier statements regularly

Troubleshooting

Debit note not generated?

• Ensure the purchase return is saved and finalized (not in Draft status)
• Check that the purchase return was created successfully
• Verify your debit note numbering settings are configured
• Contact support if the issue persists

Debit note amount is incorrect?

• Review the purchase return items and quantities
• Check tax calculations and discount applications
• Verify the original purchase bill amounts
• Ensure round-off settings are correct

Can't print or email debit note?

• Check that the purchase return is finalized
• Verify email settings are configured if emailing
• Ensure printer settings are correct
• Check that debit note templates are available

Debit notes are essential documents for managing purchase returns and maintaining accurate financial records. Understanding how they work helps ensure proper accounting and compliance with tax regulations.