An invoice is a commercial document that indicates the purchase and sale of a good or service. It is legally and fiscally valid. An invoice is a document of a commercial nature that indicates a sale or purchase of a good or service and which, among other things, must include all the information on the operation. We can say that it is an accreditation of a transfer of a product or service after its purchase.
concept and elements
Who is obliged to issue invoices
Every entrepreneur or self-employed person is obliged to issue invoices for the sale of goods or services. They are also obliged in the case of advance payments, except in the case of intra-Community sales of exempt goods. We can conclude that an entrepreneur or self-employed person is obliged to issue an invoice in the following cases:
- When their customer is another entrepreneur or self-employed person.
- When the customer (a private individual) requests it.
- For the export of goods that are exempt from VAT.
- For intra-Community transactions.
- When your customer is the public administration or a legal entity that is not a businessman or self-employed (in the first case, an electronic invoice must be issued).
- For the sale of assembly or installation goods before they are made available in the territory where the tax applies.
- For sales made at a distance and sales subject to excise duty.
The issuer of the invoice must always keep a copy and give another copy to his customer.
Regulation of the mandatory contents of an invoice
The contents of an invoice template are predefined by the invoicing regulations. These contents are mandatory for anyone who has to issue an invoice justifying the sale or purchase of a good or service.
The omission of one of its mandatory contents may invalidate its validity if there is a review by Tax Agency, which is the supervisory body in charge of ensuring compliance with the regulations.
Obligation to issue an invoice
The issuing of invoices is mandatory in order to leave a record and to be able to prove that the commercial transaction has been carried out. Failure to issue an invoice may constitute a tax offence, which is prosecuted by the country’s tax authorities.
Information required on an invoice
To issue an invoice you need to include some basic data; obligatory for the validity of the invoice:
- Invoice number (correlative to the numerical series).
- Name or company name of the buyer and seller, whether a company or an individual.
- NIF of the buyer and seller as well as their fiscal address.
- Date of issue.
- Date of operations when this does not coincide with the date of issue.
- Description of the good or service.
- The price per unit and the price before taxes for each of the goods or services.
- If there is any discount or advance payment.
- Taxes: Value Added Tax and the rate applied, as well as Personal Income Tax (if applicable).
- The tax liability.
- The total amount.
- If the invoice is exempt from VAT, this must be stated by quoting the VAT law and the article by which it is exempt (for example, “Invoice exempt from VAT, according to art. 20. One. 26º”).
- In cases of invoicing by the recipient or reversal of the taxable person must be mentioned.
- In the case of belonging to the special scheme for used goods or the special scheme for travel agencies, this must also be stated on the invoice.
Types of invoices
Basically, there are two types of invoices:
- The full invoice.
- The simplified invoice.
The contents of the full invoice are set out in the previous section. For the simplified invoice the contents are the same except that:
- The simplified invoice does not include the customer’s details and;
- VAT can be indicated without a breakdown and can be included in the final price. The VAT rate, however, must be indicated.
Simplified invoices may be issued in the following cases:
- When the amount of the invoice does not exceed EUR 400 (VAT included).
- To issue corrective invoices.
- For certain transactions of less than EUR 3,000 (including VAT), for which the invoicing regulations previously in force (Royal Decree 1496/2003) allowed the issuing of receipts.
In addition to these two main types, there are other types of invoices, which are mentioned below:
- The proforma invoice, which, unlike an ordinary invoice (whether simplified or complete), is not valid for tax purposes.
- The rectifying invoice, for modifying, crediting or cancelling an issued invoice.
- The recapitulative invoice. This includes all the invoices sent to a customer in a given period in a single document.
- The original duplicate invoice, which should not be confused with a copy.
- The electronic invoice, for sales of services or goods to the Public Administration.