Working for a city or other government agency? Then you need to be good at knowing how to prepare your invoices! In this article, we explain how to properly invoice the city so that you get paid quickly and correctly. Let’s dive in together! 🚀
Understand the city’s customer statute 🔎
As a sole proprietor, it is important to understand that cities and other public authorities have a special vAT type of statute. This is because they are not ‘ordinary’ businesses, but public administrations.
It is therefore crucial to check well in advance which vAT rate applies to your specific services or supply to the city. Do not hesitate to discuss this with the city’s contact person or consult a VAT expert if necessary.
The city is usually not subject to VAT💡
First of all, it is important to know that cities and governments are generally not subject to VAT, except for some exceptions, for which they are subject to VAT. 🤔 In other words, they fall under the mixed VAT obligation. If the government does not have a vAT number, you have to invoice VAT anyway. In principle, this is 21% VAT, but beware: specific vAT rates may apply to certain services or supplies. Then you might be stuck with the other vAT rates: 0%, 6% or 12%.
But in most cases, you will therefore have to issue invoices with 21% vAT %.
Tip:
Make sure all required information is stated on your invoices. View which items you should definitely not forget here!
Specific rules for co-contractors 📝
There are also some specific rules that mean you do not have to charge VAT to a city. For example, in certain cases you can reverse the VAT when you carry out work on property. In that case, you work with a so-called vAT co-contractor. However, this is only possible if the city is subject to VAT and submits periodic vAT declarations.
It is not always the case that when a city has such a vAT number, it also submits periodic declarations. Again, do not hesitate to discuss this with your contact person at the city.
Draw up invoices for the city in Dexxter 🌐.
With a municipality as supplier, click here on ‘Belgian company’, only the company name (in this case the city) needs to be filled in. Every Belgian city has a company number, so this can also be filled in.
In addition to the standard data, it may sometimes be necessary to include extra information for cities. Inform yourself in advance with the city about any additional requirements, sometimes they want an extra mention on invoices for their internal accounting, for example.
With these tips, you as a sole proprietor will be all set to invoice cities smoothly and correctly! Good luck with your next invoices. 🚀
Dexxter, especially for Belgian sole proprietors!
Don’t lose any more time preparing, sending and following up your invoices & quotations.
