Definition

A Debit Note is a document issued by a buyer to a supplier to formally request an adjustment to an invoice. In the UAE VAT system, debit notes are used to increase the taxable amount of a previously issued invoice, usually when the supplier undercharged.

Key points

• Must reference the original invoice.
• Must include the supplier’s TRN and other mandatory VAT fields.
• Reported in the VAT Return under adjustments.
• Helps maintain accurate accounting and VAT records.

Practical example

A supplier invoices AED 9,000 instead of AED 10,000. The buyer issues a debit note for AED 1,000, and the supplier adjusts VAT accordingly.

Why it matters

Debit notes ensure compliance with VAT rules and maintain transparency in bookkeeping.