When you have sold a product and need to invoice your customer, the invoice needs to contain certain information for it to count as an invoice under the VAT Act. In this article we’ll go through what information you need to provide and what you need to consider when invoicing.
What information should an invoice contain?
In order for the invoice you send to your customer to be valid, you need to include the following information:
- Date of issue of the invoice
- Serial number
- Seller's VAT registration number
- Buyer's VAT number (only in certain cases)
- Name and address of seller and buyer
- Specification of what the invoice relates to
- Price
- Taxable amount for VAT rate
- Applicable VAT rate
- VAT amount
- In case of VAT exemption - reference to the relevant provision
Joint stock companies must also include:
- Organization number
- Place where the company has its registered office
- Company name
Other information that should be included on the invoice:
- Terms of payment and interest for late payment
- Seller's bankgiro number
- Information on whether the seller has approval for F-tax
- Type of invoice, such as partial invoice or credit invoice
- Sender's and recipient's references
- Terms of delivery
Rules on invoices
All business-to-business transactions must be accompanied by invoices, as these are used as the basis for company accounting and VAT reporting. However, an invoice is not valid under the VAT Act if the above information has not been entered correctly, which can lead to problems for both your own and your customer's business. So be careful when invoicing not to send out incomplete invoices to your customers, correcting them afterwards can be both complicated and costly. Another important thing to keep in mind is that the invoice numbers must be a consecutive series of numbers during the financial year, so it is not allowed, for example, to set invoice numbers by date.
Invoice types
Invoice (with credit)
The most common type of invoice is called an invoice for short, and is a type of credit where the selling company holds the money until the customer has paid. The invoice indicates the number of days the customer has to pay after the date of issue (invoice date). Although it is the customer's responsibility to pay the invoice on time, it is a good idea to write out the latest date for payment, for example "paid by 31/1". For business-to-business transactions, you must not give a credit period longer than 30 days unless you and your customer have agreed otherwise.
Cash invoice
A cash invoice is mainly used when a product has been paid for in cash and the buyer needs an invoice to record the purchase. A cash invoice is therefore similar to a receipt, but the difference is that more information is shown on the invoice, such as the organisation number, company name and address.
Partial invoice
Partial invoicing is mainly used when companies need to invoice during a work in progress or if there is an agreement that the customer can split the payment. The invoice will then state the full price and the amount to be paid by the customer on that particular occasion. One important thing to bear in mind is that instalments can mean that you, as a business owner, are left out of pocket for a longer period of time, which can affect your company's liquidity. It is therefore a good idea to think carefully before using progress billing as a sales trick.
Credit invoice (reverse invoice)
A credit invoice is a corrected invoice used if the original invoice is incorrect and not payable by the customer, the amount should therefore be negative and the text "to be paid" should be changed to "credited to you". Like a normal invoice, the credit invoice needs to have an invoice date and number, and the issuer of the credit invoice needs to make sure that it is clear which item is to be corrected and by how much.
E-invoice
An e-invoice is a digital invoice that is sent directly from a business system to the customer's system or online bank, instead of to a mailbox or email inbox. E-invoicing allows companies to streamline the administrative work involved in both invoicing and bookkeeping, while at the same time doing a good deed for the environment. Another advantage of e-invoices is that the sender can be sure that the invoice has been delivered, which reduces uncertainty compared to delivery to mail or e-mail boxes.
How PostNord can help you with your billing
As a PostNord contract customer, you get access to Portal Business - a platform that helps you manage everything related to your deliveries, including invoicing. Portal Business gives you an overview of all your invoices and lets you quickly see which ones have been paid. It also gives you access to the Electronic Invoice Information (ELIN) tool, where you create and send e-invoices, while shipping documents are automatically generated based on the information you have entered. Becoming a contract customer of PostNord and using ELIN is free of charge, you only pay for the shipping costs.
