This should included on an invoice in Germany
After registering as a freelancer & putting a lot of hours, it’s now time to get paid (well done, by the way). For this you will need to create an invoice that contains all the right information.
This ensures it’s legally valid, avoiding unnecessary back & forth between you & your clients, Steuerberater or Finanzamt.
Items to include on a German invoice
In order to be legally compliant in the eyes of the Finanzamt, every invoice you send should include the following information:
- Your name in full
- Your tax number (Steuernummer) and, if applicable, your VAT ID (USt ID)
- Your business address
- The full name of your client or the person receiving the invoice (in the case of larger agencies or businesses)
- The address of your client or the person receiving the invoice
- An invoice number (format is up to you, just make sure each invoice number is consecutive & unique).
- The date that the invoice was drafted
- The period or specific date during which the work was carried out
- A description of the goods or services provided
- The number, or quantity, of the goods or services provided (this could also be the number of hours worked)
- The price of the goods or services provided
- A section detailing the VAT rate applied to the goods or services listed. If VAT isn’t applicable, then the invoice should include a sentence stating why this is the case
- Invoice amount: the net amount, VAT amount, and gross amount
- Your bank details or other payment options (such as PayPal or Wise), and instructions on how to pay (if applicable)
There is some other information that you might need to include but that isn’t always necessary. This includes:
- Discounts you and your client may have agreed on
- Payment terms – most people choose two weeks or 30 days from the date of the receipt
When you use the Kleinunternehmer Regelung
Small business owners – Kleinunternehmer in German – are entrepreneurs that do not earn more than 22,000 € per year. Because of this, they do not need to pay VAT and do not have to charge VAT on their invoices. If you are Kleinunternehmer, all of your invoices should include a sentence stating that you are exempt from charging VAT.
The sentence should look something like this: “In accordance with §19 of the German VAT law, no VAT has been charged on this invoice.” – “Gemäß § 19 UStG wird keine Umsatzsteuer berechnet.”.
When you invoice clients within the EU
When invoicing clients that operate or are based outside of Germany but that are still within a member state of the European Union, you don’t have to charge any VAT on your invoices. This is due to a process known as the Reverse Charge procedure which states that the recipient of the invoice must pay the VAT charges in their own country, and not the sender. For this to work, your invoices should include the VAT IDs of both you and your client, and you will have to include the following sentence to show that you are implementing the Reverse Charge procedure:
“VAT has not been charged, according to §13b Abs. 5 UStG, subject to reverse charge in the country of receipt.” “Steuerschuldnerschaft des Leistungsempfängers (§13b Abs. 5 UStG)“
When you invoice clients outside of the EU
If the client you’re invoicing is based outside of the EU, such as the USA or South Africa, then reporting VAT is a little different, and depends on the tax treaty that Germany might have with that country. Check out this link for more information on which treaties Germany has with certain countries, otherwise, it’s probably a good thing to double-check with your Steuerberater just to be sure.
German invoice template
Here is a good example of a German invoice template that includes all the right information.
Invoice for less than €250 (including VAT)
If you’re invoicing for an amount less than €250 (including VAT), then there are fewer requirements with regards to what that invoice should contain. The following information is still mandatory:
- Your full name
- Your full business address
- The invoice date
- The description of the goods or services provided
- The number of goods or services provided (or hours worked)
- Invoice amount: the net amount, VAT amount, and gross amount
- Tax or VAT exemption if applicable
Good practices when sending invoices in Germany
To make sure that you’re dotting all of your i’s and crossing your t’s, it’s good to keep the following things in mind when invoicing as a freelancer in Germany:
- To stay legally compliant, you have to issue an invoice for any service you provide or goods you sell
- Invoices have to be kept for at least 10 years from the date of issue
- Invoices can be sent electronically or via the post
- Invoices should be sent from six months of the date that you provided the goods or services
Generating perfect German invoices with software
Nowadays, you can save tons of time by an invoicing software. Not only does it make sure to always include in the right information in the relevant spot, it also does the rest of the bookkeeping in an automagical way. It’s highly recommended so you can focus on your actual job. You can read this guide on accounting software for freelancers in Germany for more information.
Sending payment reminders
As a freelancer, it’s likely that at some point in your career you’re not going to receive a payment on time. Depending on your situation, this can be less than ideal, so it’s important to know how to follow up and make sure that the money owed to you ends up in your bank account as quickly as possible.
Once the payment deadline that you included in your invoice has passed, send a follow-up email or letter to inform your client in a friendly tone that the invoice is still outstanding. If you still haven’t received the letter in a few days, send another one. Clients are people, and people make mistakes and forget. If, however, after your courteous reminders you find that you’re still not getting paid, you may have to issue a Mahnung. However, this should be a last-ditch effort, as this would initiate a legal procedure and potentially burn any bridges you have with your client.
I hope this little guide was useful to you. Feel free to ask a question by leaving a comment.Bastien
Hey Bastien, thanks for the detailed guide! One thing I still don’t get – and am getting some conflicting information on – is about invoicing clients outside of Germany as a Kleinunternehmer. Does the Kleinunternehmerregelung prevail over other requirements? In other words, if I’m a Kleinunternehmer, can I make use of the VAT-exempt provision on all my invoices, including ones for clients outside of Germany, without registering for an Umsatzsteuer-ID?