Discounts, credit notes and cancellations — and what reaches the return

01The discount belongs to the line, not to the total

One document can carry lines taxed differently: a Cyprus supply with tax and an EU supply under the reverse charge. A deduction at the end could not be attributed to either — it would have to be spread, and any rule for spreading it would be a guess.

So it is deducted per line, before the tax is calculated. Every line keeps its own decision.

And for the same reason, percentages only: a fixed amount across lines taxed differently cannot be split without a guessed rule.

02Two levels of discount multiply

A reduction on the line and another on the whole document do not add up — they apply one after the other. Ten per cent and another ten per cent give nineteen per cent off, not twenty.

Add them and the invoice shows a discount the total does not support. The discount you state has to be the sum of the actual line reductions, or list price minus discount will not equal the net.

The discount flows into every box of the return — including the ones where no tax arises. Under the reverse charge the reported amount falls with it, in the return and in the VIES statement alike.

03A credit note is a document of its own

A credit note does not correct an old invoice; it is a new document with its own number and its own date. Its tax point is the date of the credit note, not the date of the invoice it reduces.

If the credit note falls in a later quarter than the invoice, it takes effect there. Pulling both into the same quarter would be convenient and wrong.

04Cancelling is not the same as crediting

A finalised invoice is never deleted and never altered. It is undone by a counter-entry — and both documents stay, because the numbering has to run without gaps.

A gap in the numbering is something you have to explain in an audit. That is also why the counter-entry of a cancellation cannot be deleted: the cancelled invoice would otherwise stand there with nothing against it.

05A late-payment fee belongs in no box

A late-payment fee compensates for the damage of delay; it is not consideration for a supply — nothing is supplied in return. So it belongs in no box of the return and in no VIES row.

This is a reasoned position, not a citation. It appears here with its reasoning so you can put it to your accountant — not as settled advice.

In the software this follows from where the fee sits rather than from a rule: the fee hangs on the reminder, and what gets reported are documents. A finalised invoice does not grow afterwards.

For bank reconciliation that means the claim against the customer is the invoice plus any outstanding fees. If only the invoice amount arrives, the invoice is paid and the fee falls away — withdrawn with a reason, not deleted.