How a credit note is handled in a VIES submission depends entirely on when the credit note was issued relative to your original invoice. The primary accounting rule is that VIES XML schemas do not accept negative values (e.g., -500.00). Instead, you must apply one of the two standard EU reporting methods below.
METHOD 1: The Credit Note is Issued in the Same Month..If you issue an invoice and a credit note to the same client within the same calendar month, you net the amounts together on your standard monthly return.
Scenario: You invoice a client in Greece for €10,000 on May 5th, but issue a credit note for €2,000 on May 20th due to a service dispute.
The Rule: You net the values (€10,000-€2,000=€8,000).
Note: If the credit note matches or exceeds the total monthly invoices for that specific client, bringing the balance to zero or a negative total, you completely omit that client's line from the XML file for that month.
METHOD 2: The Credit Note is Issued in a Later Month.If you issue a credit note to adjust an invoice from a previous month that you have already submitted, you cannot subtract it from your current month's sales. You must submit a Corrective/Amending Declaration for the specific historical month the original invoice belonged to.
Scenario: You successfully submitted a VIES return for March 2026 showing a €5,000 sale to a French client. In May 2026, you issue a €1,000 credit note modifying that March transaction.
The Rule: You must re-submit the March VIES file. You change the <DeclarationType> tag in the header to indicate a correction, and update that specific client's taxable amount to the newly adjusted total (€5,000-€1,000=€4,000).
Note: Balabook does not automatically generate the amended/corrective declaration file. If a correction is required for a previously submitted period, the amended declaration must be prepared and submitted manually.
