A credit memo issued to an Indian business is also a GST credit note. Each credit memo carries a credit note number, a link to the invoice it reduces, the tax breakdown the law requires, and a downloadable Credit Note PDF.

Credit Note Number

Every credit memo gets a number in the form CN/<financial year>/<sequence>, for example CN/2026-27/0001.

• The financial year runs from 1 April to 31 March, so 24 October 2026 falls in 2026-27 and 31 March 2027 is still 2026-27. The year is taken from the memo’s effective date (today when none is set), in Indian time.
• The sequence is separate for each tenant and restarts at 0001 on 1 April.
• The number is assigned once, when the memo is created, and is never changed or reused. It is allocated by an atomic counter, so memos created at the same moment never share a number.

Link to the Original Invoice

A credit raised by a cancellation references the subscription’s latest billed invoice (Paid, Partially Paid, Posted or Overdue): its ID (originalInvoiceId) and date (originalInvoiceDate). The PDF shows the invoice’s number, for example INV/2026-27/0001, and INV-<invoice id> for an invoice issued before GST invoicing, which has no number.

Tax Breakdown

The tax is worked out from that invoice, never entered by hand:

• Rate. The invoice’s effective rate: its tax divided by its pre-tax amount after discount. For a GST invoice this is its real rate, for example 18%.
• Split. The credit is a gross amount, so it is split back into a taxable amount and tax in proportion to the invoice’s tax share. This is done in paise. The tax is rounded once and the taxable amount is the remainder, so taxable plus tax always equals the credit exactly.
• CGST / SGST / IGST. If the supplier and the customer are in the same state, the tax is halved into CGST and SGST (CGST takes the lower paisa when the tax is odd, so the two always add up). If they are in different states, the whole tax is IGST. For an invoice that has GST fields, the credit note copies its supply type and both GSTINs, so the two documents always agree. Only for an older invoice are the parties looked up again: the state comes from the first two digits of each GSTIN; when a GSTIN is missing, the tenant’s and the billing address’s state names are compared; when neither is known the supply is treated as intra-state.
• Line items. Each line has a description, HSN/SAC (the invoice’s, when its lines share one code), quantity, taxable value, tax rate and tax amount. A cancellation credit has one line.

A credit memo stores these fields: creditNoteNumber, originalInvoiceId, originalInvoiceDate, taxableAmount, taxAmount, cgstAmount, sgstAmount, igstAmount, taxRate, supplyType (INTRA_STATE or INTER_STATE), supplierGstin, customerGstin and lineItems.

The supplier GSTIN is the one recorded on the invoice (the tenant’s business profile when the invoice has none).

Invoices now charge GST (see GST Invoicing), so a credit against a GST invoice carries tax. With GST on top of the price, the credit for the unused part of the term includes the GST that was invoiced on it: cancelling a 2,656 plan with the whole term unused credits 3,134.08, shown as 2,656.00 taxable + 478.08 CGST/SGST. A credit against an invoice issued without GST (before GST invoicing, or while BillHive did not handle tax) is a plain credit note: it links the invoice and shows the amount, with no tax lines.

Credits for Mid-Cycle Changes

When a plan change or similar change gives a credit for the unused part of the term, the credit is grossed up with one factor for the whole invoice: the total the customer paid divided by the total before any tax added on top.

• If every line on the invoice is priced the same way (all include GST, or all add it on top), the credit matches what the customer paid exactly.
• If the invoice mixes inclusive and exclusive lines, the credit uses the invoice’s overall ratio of amount paid to amount before tax added on top, so it can differ slightly from the exact line.

Older invoices give exactly the same credit as before.

If an invoice mixes both kinds of line and its lines cannot be read, the change does not go through, so you never get a wrong credit. You can retry it.

A credit note is plain when the invoice it credits had no GST, or when it has no linked invoice and India is set to Handled by you. A credit against an invoice issued with GST keeps its GST. See Taxation Settings.

Credit Note PDF

Open a customer’s Memos tab and choose Download Credit Note on a credit memo. The PDF is titled Credit Note and shows the credit note number and date, the original invoice and its date, the GSTINs and addresses of both parties, the line items, and the taxable amount, CGST and SGST (or IGST), total tax and total credit.

It is the same download as the API: GET /credit-memos/{id}/download. The PDF is rendered with the same engine as invoices. A tenant template named Credit Note replaces the built-in layout.

Credit Memos Created Before This Feature

Existing credit memos keep working. Their credit note number and GST fields are empty, nothing is backfilled, and they have no number until they are re-issued. Their PDF can still be downloaded; it shows the amount and no number or tax split. Credit memos added by hand are numbered, but only cancellation credits get the invoice link and the tax split.