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How long does a tradesman have to submit an invoice in Germany?

02.11.2023
How long does a tradesman have to submit an invoice in Germany?

Accounting in Germany follows a multitude of rules and regulations. A frequently asked question in this context is: “How long does a craftsman have to issue an invoice?”. This is a particularly relevant question for many crafts businesses and their customers. In this article, we will look at this question in detail and examine the process of retrospective invoicing in Germany.

Craftsman invoices: Important basics

Before we get straight to the question of the deadline for issuing a tradesman’s invoice, it is important to clarify some basic aspects. A craftsman’s invoice must meet certain legal requirements. These include, for example:

  • Full name and address of the invoicing party and the invoice recipient
  • Unique invoice number
  • Date the invoice was issued
  • Date or period of the service rendered
  • Quantity and type of service rendered
  • Unit price and total price
  • Indication of value added tax, if applicable
  • Terms of payment and due date

The deadline for issuing an invoice

The German Civil Code (BGB) generally regulates the limitation of claims. In principle, claims arising from a contract for work and services, which also includes craftsman’s services, become time-barred after three years. This period begins at the end of the year in which the service was rendered.

In plain language, this means that a craftsman basically has until the end of the third year after the service was rendered to submit an invoice. However, this is only the outermost deadline. In practice, a tradesman should always try to invoice as soon as possible after the work has been completed. This not only ensures that payment is received quickly, but also prevents possible misunderstandings or conflicts with the client.

What happens if the invoice is issued too late?

If a craftsman exceeds the three-year deadline and does not submit the invoice until after that, the consequence is that the claim is time-barred. The customer is then no longer obliged to pay the invoice. However, in practice there are often cases where customers pay anyway, whether out of ignorance or goodwill.

For the craftsman, however, this means a possible loss of income, so it is strongly advised to keep an eye on the deadlines and to submit invoices on time.

Special features and exceptions

However, there are also some special features and exceptions that need to be taken into account:

  • Agreed deadlines: In some cases, an individual deadline for invoicing can be agreed between the tradesman and the customer. This contractual agreement takes precedence over the statutory regulation.
  • Progress invoices: For larger orders or long-term projects, partial invoices are common. These are partial invoices for services already rendered. The same deadlines apply to these partial invoices as to the final invoice.
  • Subsequent corrections: It may happen that an invoice that has already been issued needs to be corrected, for example due to errors or ambiguities. In this case, the correction of the invoice is still possible after the expiry of the three-year period, provided that the original invoice was issued in due time.

In summary, retrospective invoicing in Germany is governed by a number of regulations. It is essential for tradesmen to know these regulations and to comply with them. In this way, financial losses can be avoided and a trusting relationship with the customer can be maintained.

Subsequent craftsmen’s invoices: An overview

Theoretically, invoices can always be issued retrospectively, regardless of how much time has passed since the service was rendered. There is no direct limitation period for issuing invoices per se.

But there are certain aspects to consider:

  • To avoid potential penalties, it is advisable to issue invoices within six months of the completion of the service, unless they are tax-exempt.
  • When issuing a tradesman’s invoice retrospectively, it is crucial to prove that the work was carried out properly. It is also important to ensure that all legal invoicing requirements have been met.
  • From the time of acceptance of the work, the limitation period for the claim for the service rendered begins. Therefore, depending on the period between performance and invoicing, there is no guarantee that the client will pay the subsequently issued invoice. The elapsed time plays a central role here.

Securing claims as a craftsman – focus on correct invoicing

Improper invoicing can lead to various challenges. To prevent these, you should consider the following tips:

  • It is advisable to issue invoices quickly after completion of the job. According to § 14 UStG, a tradesman has six months to issue an invoice. A delay in issuing an invoice can lead to claims for damages.
  • Without a correct final invoice, you have no right to payment, nor is it possible to send out reminders or claim interest on arrears.
  • Especially in the case of construction contracts concluded in accordance with VOB/B, it is important to adhere to the specified deadlines. If requested by the client, the invoice should be issued immediately. If the tradesman fails to issue an invoice, the client has the right to issue his own invoice at his own expense. This can determine the payment due date as well as the start of the limitation period.
  • Make sure that your invoices meet all the requirements of § 14 UStG and contain all the necessary information.
  • Define clear payment conditions and set specific payment deadlines on the invoice.

For tradespeople, it is crucial to issue invoices correctly and on time. According to § 14 UStG, you have six months to do this. Incorrect or late invoices can lead to claims for damages or loss of the right to payment. Especially in the case of construction contracts, the specified deadlines must be adhered to. It is also essential that invoices contain all the required information according to the VAT Act and define clear payment conditions.

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