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Credit note format under GST

When goods come back, a price was overcharged or the quality fell short, a credit note reduces the invoice and the GST on it. Here is a sample with the fields Rule 53 requires and the deadline to keep in mind.

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Sharma Electronics

Shop 12, MG Road, Pune 411001

GSTIN: 27ABCDE1234F1Z0 · State: Maharashtra (27)

Credit Note

Sample

Issued to

Mehta Home Appliances

Andheri East, Mumbai 400069

GSTIN: 27AAMFM5678K1ZH

State: Maharashtra (27)

Credit note no.CN/26-27/009
Date20/10/2026
Against invoiceINV/26-27/0147 dated 12/10/2026
ReasonGoods returned
Place of supplyMaharashtra (27)
# Item HSN/SAC Qty Rate Taxable value GST Tax Amount
1 Wall mount bracket (returned, damaged in transit) 8529 1 Nos ₹650.00 ₹650.00 18% ₹117.00 ₹767.00
GST rate Taxable value CGSTSGST Total tax
18% ₹650.00 ₹58.50 @9%₹58.50 @9% ₹117.00

Amount in words

Rupees Seven Hundred Sixty Seven Only

The amount above is credited to your account against the invoice shown.

Taxable value₹650.00
CGST₹58.50
SGST₹58.50
Total₹767.00

For Sharma Electronics

Authorised signatory

Sample with made-up business details. Fill it with yours in the free generator.

What is a credit note?

A credit note is issued by the supplier under section 34 of the CGST Act when, after a tax invoice:

  • the taxable value or tax charged was more than it should have been;
  • the buyer returns goods; or
  • goods or services supplied are found deficient.

It reduces your output tax and the buyer’s input tax credit for that supply. One credit note can cover several invoices. For the opposite case, where you undercharged, you issue a debit note.

Fields a credit note must show (Rule 53(1A))

  1. 1 Supplier’s name, address and GSTIN
  2. 2 Nature of the document“Credit note”
  3. 3 Credit note numberConsecutive, up to 16 characters, unique for the financial year
  4. 4 Date of issue
  5. 5 Recipient’s name, address and GSTIN or UINIf registered
  6. 6 Recipient’s name, address and delivery address with state name and codeIf unregistered
  7. 7 Number(s) and date(s) of the original tax invoice(s)
  8. 8 Taxable value, rate of tax and amount of tax credited to the recipient
  9. 9 Signature or digital signature of the supplier or authorised person

Source: section 34 of the CGST Act and Rule 53 of the CGST Rules, on the CBIC tax information portal.

Deadline

A credit note that reduces your tax must be declared in a return for a month no later than 30 November after the end of the financial year in which the original supply was made, or the date you file the annual return for that year, whichever is earlier (section 34(2), as amended by the Finance Act, 2022). After that you can still issue a commercial credit note, but your GST is not reduced.

Discounts after the sale

A discount given after the sale reduces the taxable value only if it was agreed before or at the time of supply and is linked to specific invoices, and the buyer reverses the matching input tax credit (section 15(3)(b)). Other discounts can be given as “financial” credit notes without GST, which do not reduce your tax.

E-invoicing

If you must e-invoice, credit notes to registered buyers also need an IRN, and businesses with turnover of ₹10 crore or more must report them on the IRP within 30 days of their date (GSTN advisory, from 1 April 2025).

Common mistakes

  • Not quoting the original invoice number and date.
  • Issuing the credit note after 30 November and still reducing tax in GSTR-3B.
  • Giving a GST credit note for a discount that was never agreed before the sale.

Official sources

Checked on 28 October 2026.

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Frequently asked questions

When should a credit note be issued under GST?

When the invoice overstated the value or tax, goods are returned, or goods or services are found deficient (section 34). It reduces the tax on the original invoice.

What is the time limit for a GST credit note?

Declare it in a return no later than 30 November after the end of the financial year of the original supply, or the annual return date if earlier.

Can one credit note cover several invoices?

Yes. Section 34 allows one credit note for one or more tax invoices; list the invoice numbers and dates on it.

What is the difference between a credit note and a debit note?

A credit note reduces the value or tax of an invoice (you charged too much); a debit note increases it (you charged too little).

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