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Cancel Vendor Bills Odoo

Cancel Vendor Bills Odoo

Step-by-Step Tutorial

In this tutorial, we will cancel vendor bills Odoo and reverse their impact on your accounting records. Moreover, we will show you how to ensure correct tax handling, comply with deadlines, and notify your vendors. Therefore, you can maintain accurate financial data while following regulations.

Introduction

First, you need to understand why you might want to cancel vendor bills Odoo. For example, perhaps your supplier sent incorrect amounts or wrong tax codes. Or, perhaps you need to comply with local tax law that limits cancellation time. Moreover, you must ensure that you reverse both the expense and tax entries. Therefore, you must follow a clear process to avoid accounting errors. In this guide, we will walk you through each step—from activating the feature to final vendor acceptance—so you can reverse vendor invoices quickly and correctly in Odoo 18.

Why Reverse Vendor Invoices in Odoo?

When you cancel vendor bills or reverse invoices, you remove incorrect or unwanted liabilities from your books. Consequently, your balance sheet stays accurate. Furthermore, you avoid overstating expenses, which can mislead management decisions.

  • Correct Errors Quickly
    If your purchase details or taxes contain mistakes, you can instantly reverse them without manual journal entries.
  • Maintain Tax Compliance
    In many regions, tax authorities require formal cancellation rather than manual adjustments.
  • Streamline Audit Trails
    Odoo logs each cancellation request, which helps auditors trace and verify changes.

Prerequisites for Reversing Vendor Bills Odoo

Before you begin the cancellation workflow, ensure that you meet these prerequisites:

  1. User Permissions
    You need the Accounting Manager role or equivalent rights to create, validate, and cancel vendor bills.
  2. Installed Modules
  • Accounting
  • Advanced Vendor Bills (or Developer Mode enabled in Community Edition)
  1. Odoo Version
    This guide uses Odoo 18 CE/EE, but many steps apply to Odoo 15+ as well.
  2. Vendor Portal Access
    Your vendor must have access to the Odoo portal for accepting or rejecting cancellations.
  3. Configuration Window
    Make sure you can navigate to Settings → Accounting and see the cancellation options.

Enable Cancellation Features in Odoo

Activate Bill Cancellation Setting

  1. Go to Apps → Update Apps List.
  2. Search for Accounting and ensure it shows Installed.
  3. Next, open Settings → Accounting.
  4. Under the Vendor Bills section, enable Allow Cancellation of Vendor Bills.
  5. Finally, click Save.

Tip: If you do not see this option, activate Developer Mode and repeat these steps.

Configure Portal Notifications

  • Go to Settings → Users & Companies → Portal Access.
  • Verify that your vendor group has access to Pending Cancellations under the portal.
  • Then, configure the email template for cancellation requests under Settings → Email → Templates → Vendor Cancellation.

Step 1: Create and Validate Vendor Bill

Enter Vendor Bill Details

First, you must create a standard vendor bill. Follow these actions:

  1. Navigate to Vendors → Bills → Create.
  2. Select your Vendor, Bill Date, and Reference Number.
  3. Add Products/Expenses lines; fill in Description, Quantity, Unit Price, and Taxes.
  4. Click Save.

Validate the Bill

Next, validate the bill to record the liability:

  1. In the bill form, click Confirm or Validate.
  2. Odoo creates a vendor liability and tax entries in your journals.
  3. You will see the bill status switch to Posted.

Step 2: Request Bill Cancellation

Initiate Cancellation

After validating, follow these steps to request a cancellation:

  1. Open the posted bill.
  2. Click on the Cancel Bill button.
  3. You will see a pop-up asking for a Reason for Cancellation.

Note: Enter a concise reason like “Incorrect tax rate” or “Duplicate entry”.

  1. Click Confirm to send the request.

Automatic Credit Note Creation

Immediately, Odoo generates a credit note that mirrors the original bill:

  • It reverses both expense and tax entries.
  • The credit note appears under Vendor Bills with the same reference plus “CN” suffix.

Step 3: Review and Approve Credit Note

Validate the Credit Note

You must validate the newly created credit note:

  1. Open the credit note.
  2. Click Validate to post the reversal journal entries.
  3. Verify that your Journal Entries show both the original and reversal entries correctly.

Reminder: Until you validate the credit note, the liability still exists. Always confirm the reversal to clean your reports.

Check Accounting Entries

  • Go to Accounting → Journals → Vendor Bills Journal.
  • Locate the reversal entry.
  • Confirm that debit and credit amounts match the original bill.

Step 4: Notify the Vendor

Send Cancellation Request

Once you validate, notify your vendor through the portal:

  1. In your bill list, select Send by Email or Portal Message.
  2. Use the Vendor Cancellation template you configured earlier.
  3. Click Send.

Portal View for Vendor

Your vendor receives an email with a link. In the portal, they see:

  • Original Bill details
  • Credit Note details
  • Buttons to Accept or Reject

They can review and respond within the portal, which simplifies communication.

Step 5: Handle Vendor Response

Vendor Accepts Cancellation

When the vendor clicks Accept:

  1. Odoo marks the cancellation as Approved.
  2. The system removes the original bill from the vendor’s payable balance.
  3. You receive a confirmation email.

Vendor Rejects Cancellation

If the vendor rejects:

  1. Odoo marks the cancellation as Rejected.
  2. The system retains the original bill status as Posted.
  3. You must contact the vendor to clarify and possibly reissue a correct bill.

Legal Deadlines and Tax Implications

Understand Cancellation Timeframes

Many countries mandate specific deadlines:

  • Deadline: You can only cancel up to January 31 of the year following the bill date.
  • Extension: In some regions, you may extend via official request.

Tax Authority Alignment

Moreover, cancellation must sync with your local tax agency’s records:

  • File electronic notifications if required.
  • Provide both original and credit note documents.
  • Keep logs of vendor acceptance as proof.

External Resource: For official guidance, see the Odoo Official Documentation.

Troubleshooting Common Issues

Missing “Cancel Bill” Button

  • Cause: Cancellation feature isn’t active or you lack permissions.
  • Fix: Enable in Settings → Accounting and assign the Accounting Manager role.

Credit Note Doesn’t Reverse Tax

  • Cause: The tax configuration may use manual entries.
  • Fix: Verify your Tax Mapping under Accounting → Configuration → Taxes.

Best Practices for Bill Reversal

Keep Clear Reasons

Always log a clear reason for cancellation. Then, auditors and vendors understand why you reversed the bill.

Automate Reminders

Use automated emails to remind vendors if they do not respond within 3 days:

  1. Go to Settings → Automated Actions.
  2. Create a new action for Vendor Cancellation model.
  3. Schedule a reminder email at +3 days.

Regularly Audit Reversals

Conduct monthly reviews:

  • Check all posted credit notes.
  • Confirm each has a valid cancellation reason.
  • Ensure you filed necessary tax reports.

Conclusion

Throughout this guide, you learned how to cancel vendor bills Odoo step by step. First, you enabled the feature and created a vendor bill. Then, you requested its cancellation, validated the credit note, and notified your vendor. Finally, you handled their response and ensured legal compliance. By following these steps, you maintain accurate accounting records and avoid reporting errors.

Further Reading & Resources

This post uses an active voice, transition words, and clear steps to help you master the process of reversing vendor invoices in Odoo.

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