A debit note is issued when an account is debited and no invoice or cash receipt is issued. The debit note is a document that shows the reason for the debit entry in the account.Continue Reading
A debit note is sometimes issued by a customer to a supplier of goods to make a formal request for a credit note. A supplier may also issue a debit note in place of an invoice in order to adjust an amount of a previously issued debit note. A debit note is also documentation that provides a debtor with a summary regarding a current debt. The debit note is either issued by a creditor or lender to notify that the debt is ready for invoicing, or it serves as a reminder that the debt is outstanding after a previous invoice. Even though an invoice is a notification of a owed debt, it's not considered a debit note.
Most debit notes come in the form of a letter that is sent by the creditor as a reminder to the debtor. Collection letters are a form of debit note, as they are a reminder to the consumer that the current debt has not yet been paid. If the balance goes unpaid after a certain period of time, the debit note may change to a demand for payment.Learn more about Personal Banking