Credit note – A special invoice – what does it mean?
A special invoice is a credit note / billing credit note. Unlike a traditional invoice, a credit note is not written by the service provider, but by the service recipient (“customer”). This is why the settlement credit note is also called a “reverse invoice”.
From a tax law perspective, the settlement credit note is the same as an invoice and therefore a credit note must also contain all of the following mandatory information in accordance with Section 14 (4) of the German Turnover Tax Act (UStG):
- Name and address of the recipient and supplier of the service
- Tax number or VAT ID number of the service provider
- Date of issue
- Consecutive credit note number / invoice number
- Quantity/type of delivery or service
- Date of delivery or service
- Remuneration (broken down by tax rates)
- Reference to obligation to keep records (in case of taxable supply)
- the description as “credit note
However, in common usage, the term “credit note” is not understood to mean the settlement credit note described above, but rather a correction or reversal invoice. These are what are called “commercial credit notes”. A small example: A customer requires, because of defects at the product, a purchase price reduction. The service provider accepts, cancels the invoice and issues a new one.
And then there is also the bank credit note and the credit note in accounting
In accounting, the term stands for the entry on the credit side of an account and a bank credit note is simply payments received in a bank account.
All these credit notes that reach our company and perhaps make our eyes light up at first, are nevertheless also documents that have to be processed.
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