Legal obligation to retain invoices

As an accountant in a company or as a self-employed person, it is important to know the legal retention periods for invoices. Failure to comply with the retention requirement can result in heavy penalties and possibly the loss of tax benefits. In this article, we will go into more detail about the legal obligation to retain invoices and show you how you can easily comply with this obligation using a suitable software solution such as Finui.

What is the legal obligation to retain invoices?

The legal obligation to retain invoices states that business documents such as invoices, contracts and cash receipts must be retained for a certain period of time. In Germany, the statutory retention period for invoices is generally 10 years. This period begins at the end of the calendar year in which the invoice was issued. This obligation applies to all companies and self-employed persons, regardless of their size and industry.

Why is the retention obligation important?

The retention requirement is important because tax authorities have the right to inspect a company's business records at any time. Failure to properly retain these records can result in severe penalties. In addition, compliance with retention periods can also be beneficial during business and tax audits, as all required documentation will be available.

What information must be retained?

Not only must the invoices themselves be retained, but also all relevant information required to verify the accuracy and completeness of the invoices. This includes, for example, the name and address of the service provider or recipient, the invoice date, the invoice number, the quantity and type of service or goods, as well as the gross amount and the tax amount due on it.

What happens if you violate the retention requirement?

Failure to comply with the retention requirement can result in heavy fines, up to 25,000 euros depending on the severity of the violation. In addition, tax benefits, such as the input tax deduction, can be lost if the required documents are missing or incomplete.

How can a software solution help?

One way to ensure compliance with retention requirements while minimizing workload is to use specialized software to manage invoices and other documents. Such software can automatically capture, categorize and archive invoices, eliminating the need for manual data entry and storage.

One such software is Finui. This innovative software solution is designed specifically for businesses and freelancers to automate the process of invoice processing and management. Finui not only offers automatic invoice text recognition through OCR technology, but also seamless integration with email inboxes to automatically capture incoming invoices.

One of Finui's greatest strengths is seamless invoice retention. Finui securely archives all invoices in a privacy-compliant manner for a period of 10 years, regardless of whether or not the software is still in active use. In addition, access data is never locked, so companies can access their archived invoices at any time.

In addition to automated invoice processing and archiving, Finui also offers features such as workflow management, mobile operation and multi-level approvals to make the invoice process even more efficient. With Finui, companies can not only comply with legal retention requirements, but also save time and money.

Overall, invoice retention compliance is an important part of a company's financial management. Failure to comply with the retention requirement can result in heavy fines and penalties. However, by using specialized software such as Finui, companies can ensure that all invoices are archived securely and without gaps, without the need for significant manual effort.

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