Dennis Madamba / Investopedia How a Debit Note Works A debit note is typically used in business-to-business (B2B) transactions involving an extension of credit.

The Federal Board of Revenue (FBR) has introduced the concept of 'credit and debit notes' in the federal excise regime on the pattern of sales tax to facilitate both the suppliers and the buyers ...

The note corresponds to a debit note in an accounting log, serving as a record of a revision. Business-to-business transactions use both debit and credit notes.

Under the new system, credit notes can now only be accepted in the sales tax return if the purchaser of goods issues a corresponding debit note in their Annexure-A.

The court also pointed out the Revenue Department was inconsistent in its treatment of debit notes versus credit notes, as the provisions for their issuance under Section 82/9 (1) were similar to ...