It is no secret that running a business is not only about establishing fruitful partnerships and carrying out business development activities. Every business owner also has to deal with practical matters, such as issuing invoices, which are the most common document confirming transactions. What exactly should it contain so that no mistakes are made and nothing is forgotten?
What elements should an invoice contain?
Issuing invoices is an integral part of running a business, so you need to know how to prepare them correctly. Otherwise, we may inadvertently get into trouble and render the documents legally invalid. It's worth remembering that the validity of an invoice is guaranteed by its elements, not by the name of the letter itself. Therefore, if we omit any details, we have not really drawn up a legal proof of the sales transaction. It is also important to know that we always prepare two copies of the invoice: one for the issuer and one for the buyer. What elements does the law require an invoice to contain?
- date of issue;
- the (sequential) number of the invoice - in accordance with the numbering adopted;
- the names of both the buyer and seller and their addresses;
- the taxpayer's (business owner's) VAT number;
- the VAT number by which the customer has been identified for tax or value added tax purposes;
- the exact date of delivery or completion of the products, of the performance of the service or the date of receipt of the payment - if different from the date of invoice;
- the full name of the good/service;
- any discounts/discounts/promotions;
- net sales value;
- VAT rate and value;
- total net sales, broken down into values covered by the various tax rates and exempt sales;
- VAT amounts broken down by rate;
- total amount owed.
Important note: The VAT Act does not specify which invoice address a sole trader should provide. Addresses are indicated by the entrepreneur on the CEiDG-1 application and on the VAT-R form. On the first mentioned document, the place of residence, the address for delivery, as well as the place (permanent and additional) of business activity should be indicated. On the VAT-R form, only the place of residence is indicated. If you run your business in the place where you live on a daily basis, this address must be indicated on the invoice. If you run your business away from home, indicate the address of your registered office.
Mandatory details on the invoice - who can issue this type of document?
Wondering if you have the authority to prepare invoices? By law, they should issue them:
- registered, active VAT payers;
- organisational entities, such as foundations or associations;
- persons authorised to draw up an invoice in the name of the taxable person;
- the purchaser of the goods and services himself or herself, upon compliance with certain conditions contained in the legislation.
What information should a VAT invoice contain - additional elements
We already know what data every invoice must contain in order to fulfil its function. Pursuant to Article 106e(1) of the VAT Act, we should still pay attention to some additional elements that apply to invoices issued in cases indicated in the VAT Act. These include:
- cash method - when there is a supply of goods or services in respect of which the tax obligation arises upon receipt of all or part of the payment;
- self-invoicing - where the buyer of the products issues the invoice on behalf of the seller;
- split payment mechanism - applies to sales of Annex 15 services or goods;
- margin procedure for travel agents;
- the margin scheme - second-hand goods and collectors' items (including works of art), for which the taxable amount is the margin amount.
What should a simplified invoice contain?
Entrepreneurs and other VAT payers often use so-called simplified invoices - where the amount does not exceed the equivalent of EUR 100 (PLN 450). A simplified invoice does not have to include the tax rate in accordance with Article 106e(5)(3) of the VAT Act.
Note: this type of invoice cannot be issued to a non-business individual. What elements must it contain? Here is the full list:
- date of issue;
- the date on which the supply of products or services was made or completed;
- the next invoice number;
- the name and address of the taxpayer;
- the name of the good or service;
- numbers used to identify the seller and the buyer, e.g. NIP;
- the amount of discounts and rebates;
- VAT rates;
- total amount owed.
It is worth mentioning that in a simplified invoice, we do not have to indicate the name of the purchaser, as well as his address, the quantity purchased, the net unit price, the net amount due, or the scope of services rendered.
Note: no invoice issued needs to bear a signature to be considered an accounting document.
