The invoicing rules for IT companies

When you work for yourself, alone or with partners, in the IT sector, your accounting obligations vary depending on your legal status and your tax regime. However, whatever your status, you must invoice each of your services and declare your revenue to URSSAF. Here’s a rundown to help you find your way and avoid mistakes in your IT company invoicing. Indeed, such mistakes open the door to disputes with your clients and can also cost you dearly following a tax audit.

For your invoicing to comply with accounting rules, it must meet two criteria:

• Carry all the mandatory information;
• Be sent according to certain rules.

The information to display on your invoice for an IT company

The first rule seems obvious, but it’s worth mentioning: every invoice must carry the word “Invoice.” It generally appears in the header.

N.B. To save time on your accounting, it’s strongly recommended to use invoicing software for an IT services company. When you create your accounting documents in it, the legal mentions are set up to appear automatically. Once one of your quotes is accepted, you must convert it into an invoice once your transaction is complete. The software will then make a copy of your quote (which you can modify or not) and automatically add the word “Invoice.”

The mandatory information on the invoice is as follows.

The identity of your business

Your own name or your company name must be accompanied by your full contact details. You must also add your Siren number and specify:

• registered with the RCS (Trade and Companies Register) of city X, if your activity is commercial;

• registered with the RM (Trades Directory) of city X, if your activity is craft-based.

  If you carry out a liberal profession, although no mention is mandatory, you may specify “Exempt from registration with the trade and companies register (RCS) and the trades directory (RM).”

The identity of your client

Every invoice must carry the name of your client and their contact details, whether they are a business or an individual.

The invoice issue date and the date the service was completed

Generally, the service is invoiced once it is completed. If you don’t invoice on the same day, you must specify the date.

If you offer recurring services or a subscription, invoicing for your IT company becomes regular, at a pace agreed between you and your client: monthly, quarterly, yearly, etc.

The invoice number

The legislation around invoice numbering is quite rigid. You’re free to choose your own numbering system, which can include the year and month of invoicing. The rules are then as follows:

• invoice numbers must follow one another in sequence;
• two invoices cannot carry the same number;
• if an invoice is inaccurate, you must issue a credit note, then reissue an invoice with a different number bearing the mention “cancels and replaces”;
• if your invoice spans several pages, its number must appear on each page, along with the page number and the total number of pages.

The advantage of invoicing software is that it flawlessly handles the numbering of invoicing for your IT company.

The description of the service

Take the time to detail your service. It’s more pleasant for the client, who better understands the cost, and it avoids many disputes. Clearly separate the cost of materials from that of your labor.

You can specify the quote and/or delivery note number that the invoice corresponds to.

Discounts

Any discount applying to the whole of your service appears below the total amount excluding VAT.

The amount to be paid

State the total excluding VAT, the VAT with its rate specified, and the total including VAT. If you are a sole trader (micro-entrepreneur) and haven’t exceeded the VAT exemption threshold, add the mention “VAT not applicable, Article 293B of the French General Tax Code.”

The payment due date

While the payment due date isn’t mandatory, it’s recommended to specify it. Otherwise, the default term applicable is 30 days for France and 60 days for abroad.

The payment method

Specifying the payment method is optional, but more convenient for the client. At the same time, specify the terms of any early-payment discount and the late-payment penalty rates that are added to or deducted from the invoice.

Collection fees

The flat-rate penalty covering collection costs is €40. You can add late-payment penalties, which must then be stated in your terms and conditions of sale.

Professional liability, ten-year warranty and other insurance

Mention your professional insurance policies, along with your insurer’s contact details.

The rules for sending invoices for your products and services

For your invoice to be legal, it must meet a few criteria. First, it must be sent within the month following the completion of your service.

If, for example, you resell IT hardware without labor, you can issue your invoice on the order date. In that case, specify the payment due date, which is often set at delivery.

If your service extends over several months, you’re entitled to issue installment invoices, after agreement with your client.

Paper invoicing

Invoices are printed less and less, but some clients still prefer this format.

Digital invoicing

You can simply send invoices by email. Favor the PDF format, which cannot be modified and is readable on all computers.

If you want to protect yourself, you have the option of authenticating your electronic invoices and/or guaranteeing their receipt. You can in particular use electronic signature confirmation or an EDI (Electronic Data Interchange) protocol.

Invoicing for your IT company must be kept for 10 years. The tax authorities may request your invoices during an audit. If you use invoicing software like Bizyness, you don’t have to worry about preserving your files. All your accounting is indeed backed up on a professional cloud that you can access at any time. This also saves you from cluttering your computer, storing your documents on an external drive or on paper, or renting cloud storage yourself.