What must be on your invoice, and what it costs when a field is missing

An invoice is the document your VAT hangs on. Miss a mandatory field and the deduction can be refused, on your customer's side and on yours. Here is the full checklist, the deadline for sending an invoice, the rules for reverse charged VAT, and what to do with a purchase invoice that is wrong.

Why this is more than a formality

An invoice is the document the VAT hangs on. Miss a mandatory field and the tax administration can refuse the deduction: your customer's on your sales invoice, and yours on a purchase invoice that is wrong. For a startup buying a lot of software, hosting and one-off services, that second one is the bigger risk, because you do not write those invoices yourself.

The good news is that it is a checklist. The requirements are fixed, they rarely change, and every invoicing package can fill them in.

The mandatory fields

• Your own full name and address, and your customer's. A PO box is not enough: it is about where you are actually established.
• Your VAT identification number.
• Your Chamber of Commerce number.
• The date of the invoice.
• An invoice number that is sequential and used only once.
• The quantity and the nature of what you supplied.
• The date you supplied it, or the date of a prepayment.
• The amount excluding VAT, split per VAT rate.
• The VAT rate you apply.
• The VAT amount.

The deadline: the fifteenth at the latest

Your invoice has to be out by the fifteenth day of the month following the supply. Supply in March and the invoice has to be there on 15 April.

What surprises founders here: invoicing late does not move the VAT. You report the VAT in the period in which the invoice should have gone out at the latest, not in the period you eventually sent it. A March supply invoiced in June therefore belongs in your first quarter return.

The invoice number, and why it goes wrong so often

Sequential and unique sounds simple until you have two systems. A startup invoices subscriptions from its own application and one-off projects from the bookkeeping software, and then two series run through each other with duplicate numbers or with gaps.

Two series are allowed, as long as each series is recognisable and sequential. What is not allowed is using the same number twice, and what you do not want is a gap you cannot explain. In a tax audit a missing invoice number is usually the first question.

If the amount stays under a hundred euros

For invoices up to and including 100 euros inclusive of VAT you may send a simplified invoice, with fewer fields on it. Handy for small amounts, but it is an exception and not a rule: most packages simply put everything on, and then you never have to think about it.

Reverse charge and customers in the EU

If you shift the VAT to your customer you charge no VAT yourself. Instead you put the words VAT reverse charged on the invoice, along with your customer's VAT identification number. You do state the amount per rate, as it would have been if the VAT had not been shifted.

For a service to a business customer in another EU country it works the same way, and that invoice also comes back in your ICP declaration. If the wording is missing or your customer's VAT number is wrong, the shift does not hold and you remain liable for the VAT yourself.

What to do with an invoice that is wrong

If a purchase invoice arrives with a mandatory field missing, ask your supplier for a correct one. That is almost always a single email.

Book it as it is and you book the cost but not the VAT, which costs you exactly the VAT amount. Sort it out in the same month: a correction over a period already filed is possible, but then a supplementary return goes out for something one email would have prevented.

Keeping them

You keep your outgoing and incoming invoices for seven years, and in the form in which you sent or received them. A pdf stays a pdf. A paper invoice may be scanned, but then the digital version has to be a correct and complete representation of the original and the authentication features have to be preserved.

What we do about this

We set your invoicing up so the mandatory fields are filled automatically, and when we book them we check that your purchase invoices meet the requirements. If an invoice arrives whose VAT is not deductible, we tell you while it can still be repaired. On reverse charge and EU customers we watch the wording and the VAT number, and we process the invoice in your return and where needed in your ICP declaration.

In short

• Ten mandatory fields, and your package can fill every one of them.
• Invoice by the fifteenth day of the month after the supply, and invoicing late does not postpone the VAT.
• Invoice numbers sequential and unique, even when you invoice from two systems.
• Under 100 euros including VAT a simplified invoice is allowed.
• On reverse charge: the wording plus your customer's VAT number.
• Keep them seven years, in the form in which you sent or received them.