How to Write an Invoice: Requirements, Guide & Free Template

Writing an invoice is one of the most routine yet essential tasks in business. Whether you are selling a vehicle as a car dealer, billing for workshop services, or delivering spare parts – without a correct invoice, there is no money in the account and, in the worst case, trouble with the tax office. In this comprehensive guide, you will learn everything about the mandatory information on invoices, receive a step-by-step guide, and find a free invoice template for reference.

Good to know: Since January 1, 2025, the e-invoicing mandate applies to B2B transactions. Invoices must increasingly be created in structured electronic formats (XInvoice, ZUGFeRD) – no longer just as PDF. With a professional invoicing software, you are on the safe side.

What is an invoice? – Definition and legal basis

According to Section 14 (1) UStG, an invoice is any document used to settle a delivery or other service. It serves as evidence of the business transaction and is simultaneously the basis for the input tax deduction of the invoice recipient. If mandatory information is missing, the tax office can deny the input tax deduction – an expensive error that is easily avoidable.

In the automotive trade, different types of invoices arise: the classic sales invoice for new and used cars, invoices with margin taxation per Section 25a UStG, workshop invoices, invoices for accessories and parts, and increasingly e-invoices in the B2B sector.

Mandatory information on invoices per Section 14 UStG – the complete checklist

For an invoice to be formally correct and for the invoice recipient to claim the input tax deduction, it must contain certain mandatory information. These are conclusively regulated in Section 14 (4) UStG. Here is the complete list:

• Full name and address of the service provider (invoice issuer)
• Full name and address of the service recipient (invoice recipient)
• Tax number or VAT identification number (USt-IdNr.) of the invoice issuer
• Issue date (invoice date)
• Sequential invoice number (assigned once only)
• Quantity and standard commercial description of the delivered goods or type and scope of the service
• Date of delivery or service (or payment date for advance payments)
• Consideration – broken down by tax rates and tax exemptions (net amount)
• Applicable tax rate (19% or 7%) and the corresponding tax amount, or a note on tax exemption
• Reductions in consideration agreed in advance (e.g., cash discount, rebates), if not already reflected in the consideration
• Note on reverse charge liability, if applicable

Writing an invoice – step-by-step guide

Follow these seven steps to create a complete and legally compliant invoice:

Sample invoice: what a correct invoice looks like

The following example shows a typical invoice from a car dealership. Use this sample as a guide for your own invoice template:

Tip: Download our free invoice template and customize it with your company details. This ensures that no mandatory information is forgotten.

Special cases when writing invoices

Small business invoice (Section 19 UStG)

If you use the small business exemption per Section 19 UStG, you must not show VAT on your invoices. The invoice contains only the gross amount. Instead, you must include a note, for example:

“No VAT charged pursuant to Section 19 UStG.”

All other mandatory information (name, address, invoice number, service description, etc.) applies unchanged. The small business exemption applies to entrepreneurs with prior-year revenue of no more than 25,000 EUR (raised from 22,000 EUR since 2025) and projected revenue in the current year of no more than 100,000 EUR.

Small-amount invoice (under 250 EUR)

For invoices with a total amount up to 250 EUR (gross), simplified requirements apply per Section 33 UStDV. The following information suffices:

• Full name and address of the invoice issuer
• Issue date
• Quantity and type of delivery or service
• Consideration and tax amount in one sum (gross amount)
• Applicable tax rate (or note on tax exemption)

For small-amount invoices, neither the recipient’s details nor an invoice number or tax number are required. This is practical for fuel receipts, hospitality receipts, or small workshop services.

Reverse charge invoice

For certain cross-border transactions within the EU or for certain domestic services (e.g., construction services), not the service provider but the service recipient owes the VAT. In this case:

• Do not show VAT on the invoice
• Include the note “Reverse charge – VAT liability of the service recipient”
• State both your and the recipient’s VAT ID

In the automotive trade, reverse charge is particularly relevant for intra-Community supplies of vehicles to businesses in other EU countries.

Margin taxation in the car trade (Section 25a UStG)

Margin taxation is a central topic for used car dealers. When purchasing a vehicle from a private individual, no input tax is incurred. On resale, therefore, only the difference between the purchase and selling price is taxed – not the full selling price.

AutoPult automatically calculates the differential tax based on your purchase and selling prices and creates the correct invoice with all required notes – including the necessary vehicle data.

Invoice numbers: rules and best practices

The sequential invoice number is a mandatory component of every invoice. The following rules apply:

• Uniqueness: Each number may only be assigned once
• Number ranges: You may use multiple number ranges (e.g., by location, department, or fiscal year), as long as each number remains unique
• Format: Letters, numbers, and separators are permitted (e.g., “INV-2026-0001,” “WK-M-00042”)
• Gaps: Gap-free numbering is not legally required but is preferred by the tax office. Large gaps may trigger inquiries during tax audits

Practical tip: Use one number range per year, e.g., “INV-2026-0001.” This helps you maintain an overview and start each year clearly. An invoicing software assigns numbers automatically and prevents duplicates.

Formulating payment terms correctly

Payment terms are not a legal requirement but belong on every professional invoice. Common formulations in business:

Please note: without an explicit agreement, the statutory payment period of 30 days applies (Section 286 (3) BGB). After that, the debtor automatically enters default, provided the invoice meets the relevant requirements.

Retention obligation: 10 years of archiving

Both outgoing and incoming invoices are subject to tax retention obligations. The key rules:

• Duration: 10 years from the end of the calendar year in which the invoice was issued (Section 14b UStG, Section 147 AO)
• Format: Invoices must be retained in their original format – a digital invoice must be archived digitally, a paper invoice must be preserved in the original (additional digital backup recommended)
• Readability: The invoice must remain readable and machine-processable throughout the entire retention period (for e-invoices)
• GoBD compliance: Archiving must comply with the Principles for the Proper Management and Storage of Books (GoBD) – meaning: audit-proof, unalterable, traceable

Digital or paper? – Invoices in 2026

The days when invoices were sent exclusively on paper are definitively over. Since the e-invoicing mandate of 2025, all companies in the B2B sector must at least be able to receive e-invoices. Transitional periods for sending apply until 2027/2028.

The advantages of digital invoices are obvious:

• Faster payment receipt – invoices reach the recipient instantly
• Fewer errors – automatic mandatory information verification by software
• Lower costs – no postage, no paper, no printer
• Easy archiving – digital, searchable, GoBD-compliant
• Automatic further processing – direct transfer to accounting

Whether you want to write your invoice for free – for example with a template in Word or Excel – or use a professional invoicing software directly: what matters is that all mandatory information is included and the invoice is properly archived.

The 8 most common mistakes when writing invoices

Avoid these typical pitfalls that are regularly flagged during tax audits:

1. Missing date of service: Even if delivery and invoice dates are identical, the date of service must be explicitly stated.
2. Incomplete recipient details: “Company Mueller” is not enough – the full name and correct address are required.
3. Duplicate invoice numbers: Each invoice number may only occur once. A common error with manual number assignment.
4. Incorrect or missing tax number: Without a tax number or VAT ID, no input tax deduction is possible.
5. VAT on margin-taxed invoices: Under Section 25a UStG, VAT must not be shown – a frequent and costly error in the car trade.
6. Vague service description: “Service” or “goods” is not sufficient. The service must be specifically described.
7. Missing note for tax exemption: For reverse charge or intra-Community supplies, the legally required note is often missing.
8. No retention in original format: A printout of a digital invoice does not replace digital archiving.

Writing invoices for car dealers: specifics in the automotive trade

In the automotive trade, there are some specifics that must be considered when writing invoices:

Vehicle data on the invoice

For vehicle sales, the following details belong in the complete service description:

• Make, model, and trim level
• Vehicle Identification Number (VIN)
• First registration and mileage
• Color and key equipment features
• Engine displacement, power output, and fuel type

Standard taxation vs. margin taxation

For every vehicle sale, you must decide whether standard taxation (with separate VAT statement) or margin taxation (without VAT statement, only on the margin) applies. The decision depends on whether input tax was incurred at purchase or not. AutoPult supports both options and automatically selects the correct taxation type based on the purchase data.

Warranty and liability information

Although not part of the tax-related mandatory information, it is advisable to include notes on the invoice or in an appendix regarding liability for defects (for used cars, at least 12 months for consumers) and any warranty services.

Writing invoices for free – or with software?

In principle, you can write an invoice for free – with a Word or Excel template that you customize with your company details. Our free invoice template already contains all mandatory information as placeholders and is suitable for getting started.

However, beyond a certain invoice volume or with special requirements (margin taxation, e-invoicing, automatic number assignment), using an invoicing software pays off. The advantages:

• Automatic mandatory information verification – no detail is forgotten
• Sequential invoice numbers are assigned automatically
• Customer database – enter recipient data only once
• Automatic calculation of VAT and differential tax
• E-invoices in XInvoice and ZUGFeRD formats
• GoBD-compliant archiving
• Payment monitoring and automatic payment reminders

How AutoPult handles invoicing for car dealers

AutoPult is the specialized software solution for the German automotive trade. In the area of invoicing, AutoPult offers:

• Automatic invoice generation from the vehicle sales process – all data (VIN, mileage, price, taxation type) is transferred directly
• Correct margin taxation – automatic calculation and legally compliant presentation on the invoice
• E-invoicing included – XInvoice and ZUGFeRD 2.0 at the click of a button, ready for the e-invoicing mandate
• Template management – individual invoice templates with your logo and corporate design
• Automatic number ranges – separated by location, department, or invoice type
• GoBD-compliant archiving – all invoices are stored audit-proof and permanently
• DATEV export – seamless handover to your tax advisor

Conclusion: Instead of laboriously creating invoices via templates and manually checking mandatory information, AutoPult handles this automatically. This saves you time, prevents errors, and keeps you on the legally safe side. Discover the invoicing software now

Frequently Asked Questions (FAQ)