Issuing a credit note (avoir) in France

Sooner or later every landlord sends an invoice that turns out to be wrong: the wrong rent after an indexation, a charge that belonged to another tenant, a period billed twice, a lease that ended a month earlier than the system knew. In France the fix is not to open the invoice and change it. Once an invoice has been issued, it stays as it is, and the correction takes the form of a separate document: the credit note, or avoir.

This guide explains why the rule exists, what a credit note has to show, how full and partial credits differ, and the mistakes that cause trouble at audit time.

Why you cannot edit or delete an issued invoice

A French invoice is a tax and accounting document, not a working draft. Once it has been numbered and sent, the tenant may already have booked it, paid it or deducted the VAT on it. If the landlord quietly changed the amount or removed the invoice, the two sets of books would no longer agree, and nobody could tell which version was the real one.

The numbering rules make the same point. Invoices must carry a unique number from a continuous, chronological sequence, with no gaps. A deleted invoice leaves a hole in that sequence, and a hole is exactly what a tax inspector looks for, because it can hide unrecorded income. An edited invoice is worse: the number exists, but the document behind it has changed.

So the rule in practice is simple. Before an invoice is issued, you can correct it or throw it away freely. After it is issued, you leave it alone and issue a credit note that reverses all or part of it.

What a credit note must show

A credit note is itself an invoice document, so it follows the same rules as an invoice, plus one extra requirement: it must point clearly at the invoice it corrects. In practice it should carry:

• the word "Avoir" (or "Credit note") so it cannot be mistaken for an invoice;
• its own unique number, issued in sequence, and its date of issue;
• the number and date of the original invoice it relates to;
• the identity of the landlord company (name, address, SIREN, and VAT number where it has one) and of the tenant;
• the amount credited, split into the amount before VAT, the VAT rate and the VAT amount when the original invoice carried VAT;
• the reason for the credit, in a few plain words.

The VAT split matters. When the original invoice charged VAT, the credit note reduces the VAT the landlord collected and the VAT the tenant may deduct, so both parties need the VAT figure to adjust their returns. The credit should use the same rate as the original invoice, not today's rate.

Credit notes can share the invoice number sequence or run in a separate continuous series, as long as the method is consistent and each series stays unbroken. Ask your accountant which approach your companies use and stick to it.

Full credit or partial credit

There are two common situations, and they leave the invoice in different states.

• Full credit (cancellation). The whole invoice was wrong: wrong tenant, wrong period, a lease that had already ended. You credit the entire outstanding amount, the invoice is cancelled, and if a bill is still due you issue a fresh, correct invoice with a new number.
• Partial credit. The invoice was broadly right but one amount was too high: a service charge overstated, a rent increase applied too early. You credit only the difference. The invoice stays valid, and the tenant owes the reduced balance.

Either way, the original invoice keeps its number and stays in the books. The tenant's account shows the invoice as a debit and the credit note as a credit, and the balance between them is what is actually owed.

Common mistakes

• Re-issuing the same number. Sending a "corrected" invoice under the original number means two documents now claim the same number. Use a credit note and, if needed, a new invoice.
• Crediting more than is outstanding. If part of the invoice has already been credited, a second credit for the full original amount over-credits the tenant. Credit against the remaining balance.
• Leaving out the original invoice reference. A credit note that does not say what it corrects is hard to reconcile, for you, for the tenant and for an auditor.
• Using a negative invoice instead of a credit note. Some systems allow a negative line on a new invoice. It muddles the audit trail and makes the tenant's statement hard to read.
• Forgetting the money side. If the tenant has already paid the wrong invoice, the credit leaves them in credit. Decide whether to refund or to apply it to the next invoice, and record that decision.

Step by step

1. Confirm what is wrong and by how much, against the lease and the previous invoices.
2. Check what is still outstanding on the invoice, after payments and any earlier credits.
3. Decide between a full credit (cancel and re-invoice) and a partial credit (reduce the balance).
4. Issue the credit note with its own number, a reference to the original invoice, the VAT split and a short reason.
5. Send it to the tenant with a note explaining the correction.
6. If a correct invoice is still due, issue it as a new invoice.
7. Settle any overpayment: refund it or carry it forward, and make sure the tenant's statement shows the result.

How PropertyOne handles it

In PropertyOne, an invoice that has not yet been issued carries a placeholder reference and can simply be discarded: no number is used, nothing needs reversing. Once an invoice is issued, it can no longer be edited or deleted. The only way to reduce it is a credit note.

• A credit note draws its number from the same continuous sequence as the holding company's invoices, so the series stays unbroken.
• The amount you can credit is capped at the invoice's remaining balance, after payments and earlier credits, so an invoice cannot be over-credited.
• Crediting the full remaining balance cancels the invoice and marks it void. A smaller amount reduces the balance and leaves the invoice payable.
• The VAT split is calculated at the original invoice's rate, and the PDF references the original invoice number. Credit notes are produced in French and English.
• Once issued, a credit note is immutable. A mistake on a credit note is corrected by another credit note, never by an edit.
• Every credit note records who issued it and why, both on the invoice's own timeline and in the organisation's audit log, and it appears on the tenant's account statement next to the invoice it reduces.