How are credits and cancellations represented electronically?

Two terms that are often confused

Credit in the sense of invoice correction. The seller corrects their own invoice downwards. This is the usual case.

Credit in the VAT sense (§ 14 Abs. 2 UStG). The service recipient settles themselves – for example, in commission settlements. This is something completely different, with its own requirements.

This confusion regularly leads to incorrect document types.

What is technically necessary

• The document type must indicate the correction
• A field with the original invoice number
• A unique sequential number for the correction

What is not allowed

Overwrite or delete the original invoice. It is subject to retention requirements. Even an erroneous invoice must be retained.

Just send a new invoice without canceling the old one. Then there are two invoices in circulation, and the recipient does not know which one is valid.

The clean process

1. Cancellation document with reference to the original invoice
2. New, correct invoice with a new number
3. Retain both as well as the original

Alternatively, a correction invoice that only shows the difference – also with a clear reference.

Common mistake in practice

The reference to the original invoice is missing or is only in the subject line. Then the recipient's accounting cannot automatically assign it, and the entire advantage of the e-invoice is lost for this transaction.

This text does not replace tax advice.