Definition: Incoming Invoice

What is an Incoming Invoice? Definition and meaning

An incoming invoice is an invoice document. It is sent to a company on the basis of a service received. The incoming invoice prompts a company to settle an outstanding receivable from a supplier or service provider within the framework of receivables management.

Structure & Content of an Incoming Invoice

Incoming invoices, similar to an invoice, have certain details that are required to be stated. These include:

Full name & address of the invoice issuer and recipient
Invoice number
Invoice date
Tax number / VAT ID
Quantity & type of goods delivered
Date of delivery / service
Amount charged
Applied tax rates
Granted discounts, early payment discounts, bonuses, etc.

Incoming invoices must also be retained in paper form for 10 years.

Difference Between Incoming Invoice and Outgoing Invoice

Incoming Invoice:

A supplier or service provider invoices a company for an outstanding receivable.

Outgoing Invoice:

The company itself issues an invoice to a customer for the deliveries or services it has provided.

Input Tax Deduction via the Incoming Invoice

Companies can reclaim the VAT on an incoming invoice from the tax office. This reduces the taxes the company itself has to pay for its own products or services at the tax office. This process is referred to as input tax deduction.

Frequently asked questions

What must an incoming invoice contain?

An incoming invoice must state mandatory details: the full name and address of the invoice issuer and recipient, the invoice number, the invoice date, the tax number or VAT ID, the quantity and type of goods delivered, the date of delivery or service, the amount charged, the applied tax rates as well as any granted discounts, early payment discounts and bonuses.

What is the difference between an incoming invoice and an outgoing invoice?

With an incoming invoice, a supplier or service provider invoices a company for an outstanding receivable. With an outgoing invoice, the company itself invoices a customer for the deliveries or services it has provided.

Can I reclaim the VAT on an incoming invoice?

Yes. Companies can reclaim the VAT on an incoming invoice from the tax office, the so-called input tax deduction. This reduces the taxes they have to pay themselves. You can capture and manage documents digitally with the incoming invoices from projectfacts.