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Legal requirements for the content of an invoice
If you have provided a service, you naturally want to be compensated promptly and therefore create an invoice. When creating this bill, you must pay attention to several important points to ensure that it is both legally correct and complete.
Mandatory information on the invoice
- Name and address of your company: Your full name or company name, as well as the address.
- Name and address of the invoice recipient: The full name and address of the customer.
- Tax number or VAT identification number: Either your tax number or, if available, your VAT ID.
- Invoice date: The date on which the invoice was issued.
- Sequential invoice number: Each invoice must have a unique, sequential invoice number.
- Service date: The date of the delivery of goods or the provision of a service.
- Quantity and type of delivered items or the nature and extent of the provided service: A precise description of the services rendered or goods delivered.
- Payment (net amount) and tax amount: The net amount and the VAT amount must be listed separately.
- Applied VAT rate: The VAT rate (e.g., 19% or 7%) should be clearly stated.
- Total amount: The total amount to be paid by the customer, including VAT.
- If you do not charge VAT due to the small business regulation according to § 19 UStG, you should also note that.
Correct calculation
Ensure that all amounts are calculated correctly, especially if you have granted discounts or special prices. The invoice amount must be clear and understandable.
Deadlines and payment terms
Specify clear payment terms, e.g., "Payable within 14 days of receipt of the invoice." You can also indicate whether a discount is granted and what the consequences of late payment are (e.g., late fees).
Compliance with legal requirements
Some invoices are subject to special legal regulations. To ensure that your invoice complies with these legal requirements, you should definitely follow the regulations of § 14 of the German VAT Act.
Digitalized invoices
If you create or send the bill electronically, ensure that it complies with the requirements for electronic invoices (EU Directive EN 16931), particularly regarding readability and the immutability of the data.
Note
You must keep copies of invoices for at least 10 years to comply with legal retention obligations.
Tip for incoming invoices
Also, make sure that incoming invoices strictly contain all necessary and correct information. If you have accepted incorrect invoices, this can lead to difficulties, especially during tax audits, such as:
- The tax office might refuse the input tax deduction.
- The invoice may not be recognized for tax purposes.
- The (wrongly) refunded input tax must be repaid to the tax office.
- Interest may be charged on the reclaimed amount, and in severe cases, even fines may be imposed. So, always request a correction of the incorrect invoice!
Even if you made a mistake yourself, you should correct invoices afterward to avoid future difficulties.
How to do this can be found, for example, in our article: "Correction of an Incorrect Invoice"
