Construction Invoicing Software

Construction — covering both building and public works — is an industry that encompasses all activities related to designing and constructing public and private buildings, whether industrial or not, as well as infrastructure such as roads and pipelines. To set up your business, you must comply with the requirements imposed by law, including bookkeeping that matches your legal status. Construction invoicing software is designed to manage accounting elements and to make it easier to interact with prospects and clients when issuing quotes.

Construction trades

Construction is one of the largest industries in France, with 555,000 businesses employing 641,000 workers. The industry’s total revenue exceeds 84 billion euros. Finally, 38% of French tradespeople work in the construction sector.

Here are some of the construction trades you can practice as a self-employed professional. For each of them, you need to check the prerequisites: specific authorizations, qualifications, experience, professional insurance, worker safety on job sites, and so on.

• BIM manager (Building and Infrastructure Modeling).
• Tiler.
• Carpenter.
• Site supervisor.
• Heavy equipment operator.
• Site manager.
• Road builder.
• Draftsperson.
• Construction economist.
• Electrician.
• Land surveyor.
• Crane operator.
• Construction engineer.
• HVAC engineer.
• Mason.
• Joiner.
• Heating installation technician.
• House painter.
• Plumber.
• Locksmith.

You choose your legal status based on your trade and how your business is set up. Once it’s defined, you’ll know your accounting obligations and can select the right construction invoicing software.

Construction invoicing software for micro-entrepreneurs and sole traders

The micro-entrepreneur and sole trader schemes offer the advantage of imposing very light bookkeeping requirements. Once registered with the trade register, the tradesperson doesn’t need an accountant or a chartered accountant. A good construction invoicing software is enough to meet their accounting obligations:

1. keep a revenue ledger chronologically listing the amount and source of income received;

2. if their activity doesn’t consist solely of service provision, keep a register summarizing all purchases;

3. issue numbered invoices.

Depending on your trade, you must account for raw material purchases, which cannot be included in a sole trader’s bookkeeping. You can ask your clients to pay for materials directly and only invoice for labor.

Accounting obligations for tradespeople under the actual tax regime

Tradespeople choosing the actual tax regime (standard or simplified actual regime) are subject to the same rules as merchants, meaning they must keep commercial accounting records.

Construction invoicing software for the actual tax regime

When you choose the actual tax regime, you must meet the following obligations:

1. numbered invoicing;

2. chronological recording of transactions affecting the company’s assets: purchases, customer invoices, bank transactions, etc. Each entry must be backed by a supporting document (purchase invoice, sales invoice, or bank statement);

3. an annual inventory listing the company’s assets and liabilities;

4. preparation of annual financial statements at the end of each fiscal year, drawn from accounting records and the inventory: balance sheet, income statement, and notes;

5. maintenance of accounting ledgers.

Annual financial statements

Every construction tradesperson under the actual tax regime must produce 3 annual documents. You can present the balance sheet and income statement in simplified form if your business doesn’t exceed 2 of the following 3 thresholds:

1. €8,000,000 in revenue excluding VAT;

2. €4,000,000 in total balance sheet assets;

3. 50 employees.

1 — The balance sheet

The balance sheet assesses the company’s assets as of the closing date. It describes the assets (cash, inventory, receivables, and fixed assets) and details the liabilities, which list loans and debts.

2 — The income statement

The income statement compares the company’s expenses (salaries, purchases, rent, etc.) against its assets through its revenue. The difference between the two reflects the company’s performance over the year.

3 — The accounting notes

The accounting notes supplement the figures in the tables with information explaining certain elements, in order to make them easier to understand.

If you are under the simplified actual tax regime, you are exempt from preparing the accounting notes. You can also opt for cash-basis accounting and estimate your inventory and work-in-progress on a flat-rate basis.

The exemption from accounting notes applies to tradespeople whose business employs fewer than 10 people, whose revenue excluding VAT is below €700,000, or whose balance sheet does not exceed €350,000.

The two mandatory accounting ledgers for construction tradespeople

As a construction tradesperson, you must keep two accounting ledgers:

• The journal ledger, which chronologically records all transactions entered in the accounts;
• The general ledger, which records all transactions entered in the accounts, grouped by account number and then chronologically.

These two ledgers must be kept for at least 10 years after the close of the fiscal year. With construction invoicing software like Bizyness, your records are stored in the cloud. You don’t have to worry about the long-term safety of your files, which remain accessible at any time.

Cash-basis accounting for the actual tax regime

If you are under the simplified actual tax regime, you have the option of keeping cash-basis accounting. During the year, you simply need to track cash outflows and inflows. You will only reconcile receivables and debts at the closing date.

The obligation to issue compliant invoices in construction

Every service provided and every sale must be documented with an invoice. For it to be legal, you must include all the mandatory information. In the event of a dispute, if your invoice is not compliant, you’ll have a hard time defending yourself against unpaid bills. On the other hand, if you use construction invoicing software like Bizyness, you can be confident you’re compliant and won’t risk any penalties in the event of a tax audit.

Legal information pre-formatted in the construction accounting software

• Seller information: legal form of the company and share capital, company name, registered office address, trade and companies registration number, SIREN number, and intra-community VAT number.
• Buyer information: name or company name, address, and intra-community VAT number. Billing address if different from the job site address.
• Invoice date.
• Invoice number: each invoice carries a unique number. Numbering must follow a chronological, continuous sequence. Any incorrect invoice must be corrected with a credit note.
• Corresponding purchase order number.
• Quantity, description, and unit price excluding VAT.
• Discounts, rebates, or early payment allowances.
• VAT rate.
• Total price excluding VAT and total VAT amount.
• Payment due date and penalties applicable in the event of late payment.
• Early payment discount terms.

Your construction invoicing software must handle all the accounting operations listed here. It should also simplify your business management with a simple, intuitive interface. It lets you manage your customer and supplier files and issue quotes in just a few clicks, before converting them into an invoice at the end of your job.

Take the time to test construction accounting software to find the one best suited to your business. They usually offer a free trial period so you can explore their features and see how easy they are to use.