Concept explainer
Invoices and credit notes
Explains how invoices are raised from charges and how credit notes adjust them, keeping the account for a visit accurate.
An invoice is the hospital's bill for a visit, drawn from the charges that visit generated. A credit note adjusts a finalised invoice while its number stays intact. This page follows a charge onto an invoice, and shows how a credit note keeps the account for a visit accurate.
Where a charge comes from
A charge is raised when a chargeable order is placed or a service is given. Read how a charge is created for the event that starts the chain.
From charge to invoice
A charge is the billable consequence of one event, such as a procedure performed or a drug dispensed. It attaches to the encounter, and it carries the price in force at the moment it was raised. Vault holds each charge as its own entry, and an invoice references those entries rather than restating their amounts.
The life of a charge stands apart from the invoice it later joins. A valid charge sits on the account well before any invoice is raised. An inpatient charge accrues for days, and the single discharge invoice gathers the whole stay at the end.
| Charge state | What it means | On an invoice |
|---|---|---|
| On the books | A valid charge owed by the responsible party. | Eligible to be invoiced |
| Held | A charge that meets a pricing or policy limit and waits off the invoice until it resolves. | Held back |
| Reversed | A charge undone after it appeared on a finalised invoice, matched by a credit note. | Stays, with a credit note |
| Cancelled | A charge undone before it reached a finalised invoice. | Removed at source |
A charge stays fixed
Once a charge is posted it holds its amount for good. Any correction is a fresh entry, a credit note or an adjustment, so the financial history stays complete. Read a charge stays fixed.
What an invoice holds
An invoice is the numbered bill that groups a set of charges and rolls them into a total. It records the charges by reference and derives the total from them, so a charge appears once and reads the same on the bill as on the account.
The invoice number is gap-free within its series, and it holds firm once the invoice is finalised. Each kind of bill draws from its own run of numbers, so an inpatient stay, an outpatient visit and a pharmacy sale keep separate series.
| Invoice type | Covers |
|---|---|
| Inpatient | A ward admission gathered into one discharge bill. |
| Outpatient | A clinic visit billed at the counter. |
| Pharmacy | A dispensing sale billed on its own. |
| Sundry | A miscellaneous charge outside the three above. |
invoiceNumber string Required | Gap-free number within the type's series, fixed at finalisation. |
invoiceType string Required | Inpatient, outpatient, pharmacy or sundry, choosing the number series. |
charges list Required | References to the charges gathered onto the invoice. |
total amount Required | The rolled-up total derived from the referenced charges. |
dueDate date | The date the balance falls due, from which overdue is read. |
status string Required | Finalised, partially paid, paid or cancelled. |
The invoice lifecycle
An invoice is minted at finalisation and moves as money posts against it. A receipt below the total leaves it partially paid, and a receipt that meets the total settles it. An invoice raised in error is cancelled. Overdue is read from the due date rather than held as a state.
The diagram below traces those states from finalisation to a settled or cancelled close.
Credit notes
A credit note is a typed reversal that adjusts a finalised invoice while preserving its number. It records the amount reversed and the reason, and it sits beside the original invoice rather than editing it.
One rule decides how a correction is recorded. A charge pulled from a finalised numbered invoice is reversed, and the reversal carries a credit note against that invoice. A charge undone before it reaches a finalised invoice is cancelled at source.
| Cancel | Credit note | |
|---|---|---|
| Used before the invoice is finalised | Present | Absent |
| Used after the invoice is finalised | Absent | Present |
| Keeps the invoice number intact | Absent | Present |
| Adjusts tax already reported | Absent | Present |
A write-off is recorded as a credit note as well, so a balance the hospital releases reads as a formal reversal against the invoice rather than a quiet edit.
A tax-reducing credit note falls inside a statutory window tied to the financial year of the supply. Beyond that window a correction posts through the open period with a back-reference instead. Read tax and statutory charges for the window and the tax basis.
A mixed bill
An outpatient visit that mixes exempt care with taxable items finalises as two documents: a bill of supply for the exempt lines and a tax invoice for the taxable ones. The two run over separate charges and are cross-linked, so each line falls under the right document.
Common confusions
Is an invoice raised for every charge at once?
One invoice gathers many charges at finalisation. A valid charge sits on the account as it accrues, so an inpatient stay carries charges for days before its discharge invoice.
How is an invoiced charge corrected?
Through a credit note. The invoice keeps its number, and the credit note carries the reversed amount and the reason against it.
What is the difference between a cancelled and a reversed charge?
A cancelled charge was undone before it reached a finalised invoice. A reversed charge was undone after, so it stays on the record with a matching credit note.
Read how a deposit and a payment post against the same account.