Can wage costs be shown on a lump sum interim invoice?
November 17, 2021 | 50,00 EUR | answered by Steuerberater Bernd Thomas
Dear Sir or Madam,
as garden architects, we take on the construction management for the realization of gardens. In larger projects, the realization can take up to 3/4 of a year and involves quite high amounts of money for both the client and the contractor, who goes into advance. Therefore, the contractor issues partial invoices, where a lump sum is billed. A breakdown of the actual quantities by items in the bill of quantities is only provided with the final invoice. In one of our projects, approximately 90% of the work will be completed in 2021, with the remaining 10% in 2022. Accordingly, the contractor will invoice a high amount of partial payments in 2021.
Now the question is: is it permissible to specify the labor cost component in a partial invoice with a lump sum (possibly estimated), so that the client can claim tax deductions for the work done by craftsmen? Or is specifying a labor cost component only allowed in an invoice with a breakdown of the services provided?
Thank you for your response.
Dear questioner,
I am happy to answer your inquiry based on the information provided in the context of an initial consultation on frag-einen.com. The response is based on the factual information you have provided. Missing or incorrect information can affect the legal outcome.
Partial payments can only be considered if a corresponding breakdown has been made and an invoice is available that meets the requirements of § 35a EStG. The invoice must clearly show the share of the salary. While an estimate by the issuer of the invoice is not excluded, it can lead to liability problems if the estimate was not appropriate.
It is recommended to use the breakdown from the final invoice (and for the customer to keep the final invoice as proof). The customer can divide the amounts into the two tax years as payments were actually made.
Best regards,
Bernd Thomas
Tax advisor
Information according to DL-InfoV: Tax advisor Dipl.-Kaufmann (FH) Bernd Thomas, Tax advisor, Jöhrensstraße 1, 30559 Hannover, Member of the Chamber of Tax Advisors Lower Saxony, membership number 146580, Professional liability insurance with R+V Allgemeine Versicherung AG, Mittlerer Pfad 24, 70499 Stuttgart, Insurance sum: 250,000 euros for each individual claim; Annual maximum benefit: 1,000,000 euros (for all damages in one insurance year); The professional regulations apply, in particular the Tax Advisory Act (StBerG), implementing regulations to the Tax Advisory Act (DVStB), professional code (BOStB), Tax Advisor Fee Regulation (StBVV) (regulations can be viewed at: https://www.berufsrecht-handbuch.de/, http://www.gesetze-im-internet.de/stberg, www.gesetze-im-internet.de/stbvv/), the professional title Tax Advisor was awarded in the Federal Republic of Germany.
