Invoice Data

Please observe that invoices indicating sales from which you want to deduct input tax, must comply with certain requirements as to form.

Invoices must contain the following information:

Download: Rechnungsmuster.pdf

The following minimum information must be stated on invoices:

• Name and address of the company making the delivery or rendering the services;
• Name and address of the recipient of the delivery or service (service recipient);
• Quantity and commercial name of the delivered objects or type and scope of the service;
• Date of delivery or other service or period of delivery;
• Pay for the delivery or other service;
• Tax amount applicable such pay;
• Applicable tax rate or information on tax exemption;
• Tax number or VAT ID of the entity: in case of intra-Community deliveries or other services rendered to an entrepreneur based in another EU member state (Sec. 3a (2) of the UStG [VAT Act]), the VAT ID of the recipient of the service must be indicated in addition to the VAT ID of the entrepreneur performing the service (Sec. 14a (1) and (3) of the UStG).
• Reference must be made to reserve charge as defined under Art. 196 of the VAT Directive for taxable sales for which the recipient of the service is liable to pay taxes. That applies to sales as defined in Sec. 13b (2) of the UStG, i.e. to deliveries of work by an entrepreneur based in a foreign country, among others, and to sales or other services to an entrepreneur based in another EU member state (reverse charge procedure);
• Date of issue of invoice;
• Serial number with one or several numerical series (must be assigned only once);
• Date of advance payment if payment is made before performance of the service;
• Any reduction of the remuneration agreed in advance, unless it has already been taken into account in the pay (e.g. bonus agreements);
• For deliveries / services performed on land plots (craftsman services) for private service recipients or entrepreneurs who use the service for private purposes, reference to their retention obligation: “you are legally obliged to retain this invoice for two years“;
• Billing by way of credit note procedure: if the recipient of the services pays for the service by granting a credit note, this matter must be indicated separately on the invoice, for instance by the term “Credit note“ (Sec. 14 (4) sentence 1 no. 10 of the UStG);
• If the tax liability is transferred to the recipient of the service (Sec. 13b of the UStG): the invoice must mandatorily include the following information: “Reverse Charge“ (Sec. 14a (5) of the UStG);
• For travel services: invoices for travel services must contain the statement: “Special Scheme for Travel Agents“ (Sec. 14a (6) sentence 1 of the UStG);
• In case of application of differential taxation: the following mandatory information must be provided on invoices for sales arising from commodities for which differential taxation is used (cf. Sec. 14a (6) sentence 1 of the UStG as amended by the Amtshilferichtlinie-Umsetzungsgesetz [Mutual Assistance Directive Implementation Act of] 2013):
• “Commodities / Special Arrangements“;
• “Works of Art / Special Arrangements“; or
  • “Collector’s Items and Antiques / Special Arrangements“.

Special provisions for invoices for small amounts

The following information suffices for invoices not exceeding a gross amount of EUR 150.00 (by derogation from the above data):

• Name and address of the entrepreneur making the delivery or performing the service;
• Quantity and commercial name of the delivered objects or type and scope of the service;
• Pay and tax amount for the delivery or other services in one total: tax does not need to be indicated separately;
• Applicable tax rate or reference to tax exemption;
• Invoice date.

Special provisions for intra-Community deliveries:

For intra-Community deliveries (Sec. 6a of the UStG), entrepreneur must mandatorily issue an invoice until the 15^th day of the month following the month of performance of the delivery (Sec. 14a (3) sentence 1 of the UStG). In addition to the general information set out above, the invoice must indicate not only their VAT ID (or the one of the entrepreneur rendering the service) but also the VAT ID of the recipient of the service (Sec. 14a (3) sentence 2 of the UStG). In addition to indicating the identification number, reference must be made mandatorily to any type of tax exemption.

Suggested wording: “Intra-Community delivery, tax exempted in accordance with Sec. 6a of the UStG.“

An intra-Community delivery applies if all of the following conditions are met (Sec. 6a (1) sentence 1 of the UStG):

• Entrepreneur or buyer transfers or sends the object of delivery to the other EU territory;
• Buyer is
  • an entrepreneur who has acquired the object of delivery for their company; or
  • a legal person who is no entrepreneur or has not acquired the object of delivery for their company; or
  • also any other buyer regarding the delivery of a new vehicle.
• The acquisition of the object of delivery is subject to the provisions of value added taxation according to the provisions applicable in another member state.

The entrepreneur making the delivery shall prove that the preconditions for an intra-Community delivery are met. Such proof might consist in a confirmation of arrival, a consignment note under trade law or a confirmation of the forwarding company which must contain certain information.

Alternative possibility: the so-called tracking and tracing protocol for transports by courier services or certificate of receipt of a postal service provider for postal items.

No obligation to issue an invoice indicating the VAT ID applies to intra-Community deliveries that are made in the form of an intra-company transfer. In these cases, entrepreneurs are not obliged to issue an invoice, as they do not make a delivery “to another entrepreneur for their company” (Sec. 14 (2) sentence 2 of the UStG).

Special scheme for construction services

Under certain circumstances, reverse charge might apply to construction services. That means that the VAT must not be paid by the entrepreneur performing the service, but by the recipient of the service. The recipient of the service will be liable to pay VAT if construction services are rendered in Germany by an entrepreneur having their registered office in Germany. The recipient of the service must be an entrepreneur themselves and must sustainably render or have rendered construction services. The financial authority applies a threshold of 10 % to define services as sustainable. This means that an entrepreneur will only render sustainable construction services, if a minimum of 10 percent of their sales volume (sum of their taxable and non-taxable sales in Germany) arises from construction services (Sec. 13b (2) sentence 2 and 5 in conjunction with (2) no. 4 and 8 of the UStG as amended by the Gesetz zur Anpassung des nationalen Steuerrechts an den Beitritt Kroatiens zur EU und zur Änderung weiterer steuerlicher Vorschriften vom 25. Juli 2014 [Act on the Adaptation of the National Tax Law to the Accession of Croatia to the EU and to Amend other Tax Provisions of 25 July 2014]) [BGBl [Federal Gazette] 2014 I p. 1266]) and sec. 13b.3 of the USt-Anwendungerlass [Code of Application of VAT] as amended by the letter of the BMF [Federal Ministry of Finance] dated 26 Sep. 2014 - IV D 3 - S 7279/14/10002).

If the above criteria are applied and result in a reverse charge for the recipient of the services, the following shall apply: the entrepreneur rendering the service must only invoice the net amount, excluding the VAT. The invoice must contain a relevant note, for example: “Reference is made to the reverse charge of recipient of service in accordance with Sec. 13b of the UStG.”

The rule applies generally also to repair and maintenance work on buildings: However, a de minimis limit applies to such repair and maintenance work. The reverse charge will not apply to invoices with a net amount of up to € 500.00. If this net invoice amount is exceeded, maintenance work will only be deemed to be construction services if parts are changed, processed or exchanged (R 13b.2 of the Code of Application of VAT).

If the recipient of the service submits a valid certificate of exemption (certificate under Sec. 48b of the EStG [Income Tax Act]), it can be assumed that such recipient will use the services rendered for them for a construction service. A reverse charge must also be assumed if recipient of the services submits a certificate issued by the competent financial authority which is limited to 3 years (USt 1 TG certificate). This certificate confirms that entrepreneur performs sustainable activities. If entrepreneur holds such a certificate, the invoice must also be issued accordingly, even though the preprint is not used for the entrepreneur rendering the service.

Such sales must be recognised in ones own VAT return and annual VAT return (annual VAT return annex UR line 53). The recipient of the service must in no event pay the VAT to the contractual partner rendering the service, but payment must be made directly to the tax authority. The sales generated to the recipient of the service must be declared by the latter in their VAT return. This amount can be recovered as input tax in the same return, as far as the recipient of the service is entitled to deduction of input tax (annual VAT return line 25).

Recipient of service as tax debtor

The principle of reverse charge has been subject to comprehensive amendments by the Act on the Adaptation of the National Tax Law to the Accession of Croatia to the EU and to Amend other Tax Provisions of 25 July 2014 [BGBl 2014 I p. 1266]) regarding construction services. From 1 January 2011, reverse charge applies also to the following sales transactions, apart from construction services:

• Delivery of heat and cold through heat and refrigeration networks (Sec. 13b (2) no. 5 of the UStG);
• Delivery of industrial scrap, scrap metal, waste materials and other objects mentioned in Annex 3 to the UStG (Sec. 13b (2) no. 7 of the UStG);
• Cleaning of buildings and parts of buildings (Sec. 13b (2) no. 8 of the UStG). This includes cleaning of building facades and cleaning of rooms and inventory;
• Delivery of gold beginning with a certain purity (Sec. 13b (2) no. 9 of the UStG).

Reverse charge applies here if the recipient of the service is an entrepreneur. For facility cleaning services, the entrepreneur to whom the service is rendered must render such services themselves. If these conditions are met, reverse charge applies. The recipient of the service is thus, in future, responsible for paying the tax and for deducting input tax even for such services.

Invoices for advance payments and final invoices

To ensure that your customers are able to recover input tax from the tax authority even for advance payments, you need to indicate the VAT amount also on an invoice for advance payments. Otherwise, the invoice must contain the normal data.

However, you need to take care in the final invoice:

If a final invoice (“final invoice”) is issued on services which have already been rendered, any advance payments received before those services were rendered must be deducted therefrom. If invoices with separate indication of tax have been issued for such advance payments, the taxes allocable to the advance payment must be deducted (para. 7 of the Code of Application of VAT).

That means, you will issue a “normal” invoice on the entire project and deduct the individually received advance payment including the tax amount allocable to such. However, it suffices to indicate the entire amount of the advance payments and the tax amounts allocable to such in one sum.

Electronic invoices

The Steuervereinfachungsgesetz [Tax Simplification Act of] 2011 provided that electronic invoices are equivalent to hardcopy invoices with effect from 1 July 2011 (Sec. 14 (1) of the VAT Act as amended by the Tax Simplification Act 2011). Since 1 July, invoices can be sent as hardcopies or “subject to recipient’s consent” also electronically. At the same time, the regulations for a sales tax audit have been made more stringent. Electronically stored and electronically transmitted invoices can be inspected in the context of a sales tax audit. For that purpose, the legal basis for a sales tax audit has been amended accordingly in the Tax Simplification Act 2011 (Sec. 27b of the UStG). If invoices have been prepared using a data processing system, the officers entrusted with the sales tax audit may, on request, inspect the data stored on the matters underlying the sales tax audit, and use the data processing system for that purpose – if necessary.

Permitted forms of transmission

Invoices may be sent:

• by email (sending of a simple email attachment without signature suffices);
• as PDF or text file (email attachment or for download);
• as computer fax or through a fax server (sending of standard fax / computer fax / fax server to standard fax is deemed to be a hardcopy invoice);
• by exchange of data carriers;
• by EDI procedure and qualified electronic signature (still possible as before).

The following applies to electronic invoices and hardcopy invoices without changes:

• the authenticity of the origin of the invoice;
• the integrity of the contents of the invoices; and
• their legibility

must be ensured (Sec. 14 (1) of the UStG). The law no longer provides any instructions as to how entrepreneur(s) should fulfil the three items mentioned above.

Correction of invoices

An electronic invoice to be corrected will not be cancelled by the fact that the recipient of the invoice returns the invoice by email. Any corrections to invoices which might need to be made must be clearly indicated in electronic invoices and must be understandable (receipt of supplement/ correction).

Archiving of electronic invoices

Electronic invoices received and sent must be archived in their original condition – before processing or conversion. It is prohibited to print and archive them as hardcopies.

Consent of recipient

Any electronic invoicing requires the consent of the recipient. One of the reasons is that the recipient of the invoice bears the risk of input tax deduction. In addition, recipient of the invoice must be able to electronically archive the electronic invoices they have received. The consent must be made expressly, but might also be given implicitly, e.g. by payment of the invoice.

In the context of a sales tax audit, electronic invoices must be submitted in electronic form (Art. 27 b (2) of the UStG). The auditor may also use entrepreneur’s data processing system. In order to avoid providing the auditor with the entire email correspondence for the sales tax audit, a separate email address should be established after having received the consent for electronic transfers and such address should be provided to all invoicing parties for transmitting their invoices. Insofar as the necessary organisational preconditions have not been met, the consent should be rejected in general – as early as upon placement of the order or by a written reply to contractor.

Recapitulative Statements (RS)

Intra-Community deliveries of goods, other services for which the service recipient who is based in another member states is liable to tax in their country (Art. 3 (2) of the UStG), as well as intra-Community triangular transactions must always be recorded by entrepreneur in a recapitulative statement (RS) and must be electronically transferred to the Bundeszentralamt für Steuern [Federal Central Tax Office]. These statements are used for supervising the intra-Community movement of goods and services. Recapitulative statements (RS) shall be made on a monthly basis. Entrepreneurs generating sales not exceeding EUR 50,000.00 per quarter can continue making the recapitulative statements on a quarterly basis as before. Reportable sales to calculate the essential sales benchmark are those arising from intra-Community deliveries of goods and deliveries made in the context of intra-Community triangular transactions (cf. letter of the BMF of 15 June 2010 IV D 3 - S 7427/08/10003-03, margin no. 5). Other taxable services for which the recipient of the service based in another member state is liable to pay tax in such country must be reported in the recapitulative statement for the last month of the calendar quarter if statements are made on a monthly basis. They may, alternatively, also be stated in the monthly statement (BMF as indicated above- margin no. 10). Any permanent extension of the periods for filing the VAT return shall not apply to the submission of RS. The statement must be submitted on the 25^th day after the end of the relevant calendar month / quarter.

Version as of: 01 January 2015

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No warranty is given for the full correctness of the information presented, despite a careful arrangement of all data. Please do not hesitate to contact us for a personal discussion if you have special questions regarding one of the topics.