How are down payments and final invoices electronically represented?

The Process

1. Down payment invoice – standalone invoice with VAT disclosure
2. Further advances, each standalone
3. Final invoice – total performance, minus the already calculated down payments along with their tax

What is required in the e-invoice

The standard provides fields for already paid amounts and references to previous invoices. These must be filled in structured format.

A deduction that only appears as a text line at the end is not processed by the receiving system – the invoice then appears as if the full amount is due.

The classic error

The final invoice shows the total amount but deducts the down payments net or forgets the applicable tax. This leads to incorrect VAT disclosure and potentially to back payments.

What the software must be able to do

• Down payment invoices linked to orders
• Automatic reconciliation in the final invoice
• Correct handling of VAT on down payments
• Structured representation in the e-invoice format

Not all software handles the last point. This should be checked before migration – especially in construction and project business, where this case is the norm.

This text does not replace tax advice.