Invoice

What it means

An invoice evidences a supply of goods or services and is at the same time a demand for payment. For a VAT payer its content is prescribed by law: both parties including their VAT IDs, a sequential number, the extent of the supply, the supply date, the taxable amount, the rate and the tax.

The supply date is not the issue date and not the due date. The first decides which period the transaction belongs to, the second is administrative, and the third says by when payment is expected.

An invoice must be told apart from a simplified invoice, which the law allows for small amounts and which may omit the customer’s details and several other particulars. For business purchases, though, a full invoice with the customer’s details is safer, because it supports both the VAT deduction and the tax-deductible expense beyond doubt.

How it works in practice

An invoice is an accounting document and is archived in the form in which it was issued or received - paper or electronic. The number sequence must stay unbroken even where a document is reversed by a credit note.

Payment in advance uses an advance invoice, and the tax point arises when the money is received; a proforma invoice by contrast is not a tax document and is not posted.

For supplies to another member state or under the reverse charge, the invoice carries no Slovak VAT but must bear the prescribed wording, for instance on the exemption or that the customer accounts for the tax, and the VAT numbers of both parties. We check these invoices separately before they go out, because they feed the control statement or the EC sales list.

What to watch out for

A missing particular is the commonest reason a customer’s VAT deduction is refused - and they will come back to you about it. So documents are checked on receipt, not at the year-end close, and a faulty invoice is corrected rather than rewritten.

Issuing an invoice late does not change the supply date. If a company bills a December service only in February, the VAT belongs to the period in which the tax point fell and the revenue to the year the service was provided. A late invoice then means correcting a VAT return already filed, and possibly a penalty for tax declared incorrectly.