A proper invoice generates tremendous value for your business. More than just saving you trouble with the tax authorities in case of an audit. Outside of your company’s accounting, your customers depend on proper invoicing to claim tax deductions.
So, what details should never be missing? In this article, we’ll cover everything you need to know about mandatory invoice details.
• Every invoice must include the full name and address of both parties, though simplified requirements exist for small invoices with country-specific thresholds ranging from €150 to €400.
• VAT identification requirements vary by country, with specific rules applying to cross-border transactions and VAT-exempt businesses within the EU.
• All invoices require basic elements such as dates, sequential numbering, and detailed breakdown of goods or services, along with their corresponding tax rates and exemptions.
• When errors occur, each country has specific correction procedures and time limits, always requiring clear reference to the original invoice.
Let's take a closer look at the fundamentals:
Mentioning the full name and address of the service provider and recipient ensures clear identification by European authorities. In Germany, for small invoices up to €250, simply the address details of the issuer are sufficient. Italy and Spain are more flexible with this adaptation, with a €400 cap, whereas France’s threshold is just €150.
Each country has specific requirements for VAT numbers and tax identification, and understanding these differences is crucial for proper invoicing.
In France, businesses must provide both their SIREN/SIRET number and their intracommunity VAT number, which follows the format FR + 2 verification digits + SIREN (9 digits). When the provider is part of a VAT group sharing a single VAT number, invoices must include the specific mention "Membre d'un assujetti unique" along with the name, address, and VAT number of the group.
Italian businesses must include their Partita IVA (VAT number) with a minimum of 11 characters on standard invoices. However, for simplified invoices mentioned above (under €400), this requirement may be waived. Spanish companies must always include their Tax ID (NIF) on all invoices, even simplified ones.
For cross-border transactions within the EU, additional rules apply. In France, businesses must obtain and include an intracommunity VAT number when providing or purchasing services from EU professionals, or when selling/purchasing goods in the EU exceeding €10,000. When using a tax representative in another EU country, their VAT number must also be included on the invoice .
Remember that proper VAT identification not only ensures compliance with tax authorities but also allows your customers to correctly claim their own tax deductions.
Always verify VAT numbers for cross-border transactions and keep your tax identification details up to date.
Invoice date and service date are mandatory - they ensure transparency - they’re crucial for proper accounting and financial management.
A unique, sequential invoice number allows for different tax authorities to navigate and process documents smoothly.
To help enable traceability, it’s important to mention the quantity and type of items delivered, or scope and type of services.
The total amount must be broken down by tax rates and exemptions, including all agreed discounts and early payment discounts.
For small invoices (following the limits defined above), only the full name and address of the issuer, the date of invoice, and the invoice items with type, scope of services or goods, and the gross price including VAT are required.
It’s understandable and expected that businesses will make mistakes. Each country has processes in place to make things right.
However, when errors are found on an invoice, the correction process varies by country. In France, it’s required to mention "Autofacturation" when the buyer issues the invoice on the seller's behalf. For Italian businesses, specific document codes must be used, with TD04 being the designated code for credit notes. Spanish regulations require that correction invoices, including simplified invoices (Factura simplificada), must both reference the original invoice and explicitly state their status as a rectification invoice.
The timing for corrections also matters. In Italy, VAT adjustments must be made within one year of the original transaction. Spanish businesses can issue correction invoices from 3 to 12 months after the tax has been paid. In all cases, the correction document must clearly reference the original invoice's number and date.
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Each European country has specific thresholds and conditions for small business VAT exemptions:
When using these exemptions, businesses must mention specific information on their invoices. For example, German invoices must state "Kleinunternehmerregelung (§ 19 UStG)" and indicate that VAT is not applicable under article 6 of the UStG. However, even exempt businesses must track their EU transactions, as they may still need to charge VAT when exceeding the €10,000 threshold for cross-border sales.
Businesses in Europe need to get to know their countries’ specific rules, but are equipped nowadays with all the tools they need to succeed. Want to prepare yourself for the upcoming e-invoicing regulations? Check out our dedicated article: 6 misconceptions about e-invoicing.
It’s probably become clear in reading this blog post that managing invoices requires a meticulous attention to detail. While these regulations may seem complex, they ensure tax compliance, allowing operations to run smoothly.
With Qonto's automated invoicing system, you can confidently create compliant invoices for any European market, saving time while ensuring all legal requirements are met. Try Qonto today and experience hassle-free, compliant invoicing for your business.
