Readers’ forum: Is credit note for building work valid?

My client is a builder who carried out a large extension project for a private customer at their mansion on the south coast. The job value was £130 000 plus VAT and the customer paid the full amount. However an architect acting for the owner was very critical of my client’s work and the price charged for extras so my client issued a credit note for £30 000 plus VAT. However my client will repay the £36 000 credit to the property owner over the next three years ie £1 000 a month.

My question relates to VAT. My client reduced his output tax by £6 000 on the return that included the date of the credit note but was this correct? Should he have reduced it by £500 each VAT quarter ie treating the repayments as inclusive of 20% VAT? If my client has...