# Credit memo workflow without posting

Source: https://developer.avalara.com/avatax-for-vat/dle9284133391360/

# Credit memo workflow without posting

Understand the workflow for issuing credit memos without posting, including methods and considerations for developers and technology partners.

This workflow is specific to the VAT ERP solution only.

Note

This workflow is provided for technology partners who intend to earn the Refunds advanced feature along with their Sales Tax badge or developers who want to include this functionality. You can skip this topic if you don't intend to add refunds to your integration.

![](https://knowledge-be.avalara.com/bundle/ozz0049272407478_ozz0049272407478/page/mes7361952680819.image?_LANG=enus)

Before crediting a sales invoice through your system, first determine which method you’ll use: [CreateTransaction](https://developer.avalara.com/api-reference/avatax/rest/v2/methods/Transactions/CreateTransaction/) or [RefundTransaction](https://developer.avalara.com/api-reference/avatax/rest/v2/methods/Transactions/RefundTransaction/). The method will vary based on the type of credit memo you’re issuing (for example, partial credit amount, crediting a specific line item, and so on).

Note

When creating credit memos against a `SalesInvoice`, the document type changes to `ReturnInvoice`. After this document type changes, either through [CreateTransaction](https://developer.avalara.com/api-reference/avatax/rest/v2/methods/Transactions/CreateTransaction/) or [RefundTransaction](https://developer.avalara.com/api-reference/avatax/rest/v2/methods/Transactions/RefundTransaction/), you won't be able to determine whether the original transaction was a purchase or sales document. If you need this information, then a workaround is to use a reference code when creating the credit memo.

## Credit memos with CreateTransaction

Learn how to create credit memos using the CreateTransaction API.

Follow these steps to generate a credit memo with the CreateTransaction API:

1.  Call the [CreateTransaction](https://developer.avalara.com/api-reference/avatax/rest/v2/methods/Transactions/CreateTransaction/) API with `type` set to `ReturnOrder`, and then use one of the following methods:

    -   A `taxOverride` set to `TaxDate`.

    -   A positive quantity and a negative amount for a line item.

2.  Issue the credit memo.

3.  Call [CreateTransaction](https://developer.avalara.com/api-reference/avatax/rest/v2/methods/Transactions/CreateTransaction/) again. Set the `type` to `ReturnInvoice` and set `commit` to `true`.

## Credit memos with RefundTransaction

Learn how to use the RefundTransaction endpoint to issue credit memos for transactions.

Follow these steps to process a credit memo with the RefundTransaction call:

1.  Call the [RefundTransaction](https://developer.avalara.com/api-reference/avatax/rest/v2/methods/Transactions/RefundTransaction/) endpoint using the original transaction ID.

2.  Issue the credit memo.