What is a credit note?
A credit note is a paper or electronic note issued by a business to a customer in place of a refund. A credit note acts like a voucher that can only be used for the particular shop, chain of shops or business that issued the credit note.
Is it legal for a business to offer me a credit note instead of a refund?
Yes, businesses are legally allowed to offer you a credit note in place of a refund. In some cases a shop may give you a credit note as a goodwill gesture, for example if you change your mind about something you bought (for products bought in a shop, you do not have a legal right to a refund because you change your mind).
However, if you are legally entitled to a refund, then the business cannot insist that you accept a credit note or voucher instead (except in very limited cases for package holidays – see below).
In general terms, you have a legal right (also called your statutory right) to a refund for:
- Items or services bought online which you cancel or return during the ‘cooling off period’
- Flight cancellations and package holiday cancellations – see more below
You also have a legal right to certain remedies if a product breaks, is not fit for purpose or does not do what the advert or seller said it would. A remedy could be a repair, replacement or a refund.
Do I have to accept a credit note or voucher?
In general, you do not have to accept a credit note if your complaint is covered by consumer law (except in very limited cases for package holidays – see below). Instead, you can insist on a repair, a replacement or a refund.
If you accept a credit note you may not be able to ask for a refund afterwards.
Airline credit notes and vouchers
Where your flight is cancelled, you are entitled to a choice of:
- Refund of the cost of your ticket within 7 days or
- Re-routing to your final destination at the earliest opportunity or
- Re-routing at a later date at your convenience, subject to availability of seats
A refund in this case means a cash refund (or a refund onto the original method of payment, where you paid by debit card or credit card or by cheque or bank order). Airlines can offer a refund by means of a credit note or a voucher but you do not have to accept this and can insist on getting a full refund.
These rules are set out in EU Regulation 261/2004(pdf).
The Competition and Consumer Protection Commission (CCPC) has more information about faulty goods and changing your mind. You can get information about your consumer rights and COVID-19 in the CCPC’s COVID-19 information hub.