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Monday, November 28, 2022

Can you self invoice in 2022? These are the rules for making bills for yourself

When an item is sold or a service is rendered, both the employer and the self-employed workers have an obligation to issue an invoice. Nevertheless, the law also establishes that the company or the person receiving the product or service is the one who issues the invoice. This is known as self-billing.

A self-invoice is an invoice that can be issued by a recipient of a product or service. Remember from Ionos that issuance of these invoices without authorization is not allowed.

While there are cases in which SMEs will not be required to issue self-invoices, there are other situations in which it will be necessary to do so. To do so, companies need to have prior authorization from the tax agency and if suitable circumstances arise, the company can issue such an invoice.

self-billing requirements

Both the employer and the recipient of the goods must agree at the time of operation that the recipient will be the issuer of the invoice. At the time of reaching the agreement, it should be specified what operations are included in it.

Therefore, the entrepreneur has to acknowledge that the invoice has been issued by the recipient of the operation and once self-invoicing, a copy should be sent to the service provider. Note that in these cases the invoice will be issued in the name and on behalf of the service provider.

In the event that the recipient of the service is not in the European Union, except in Ceuta, Melilla or the Canary Islands, the approval of the tax agency must be obtained in order to proceed as such.

The self-invoicing will therefore include the data of the recipient of the service. Similarly, this document should include the name ‘Invoice by Recipient’. It should be remembered that self-invoicing must include VAT; Accounting movement that reflects service purchased or received will be accompanied by entry with input and output VAT. Similarly, each recipient should be assigned their own chain and separate from the rest.

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