Understanding purchase invoices in France

The invoice is a key document that allows a commercial transaction between two companies to materialize. The purchase invoice is a mandatory accounting and tax document the customer receives after buying. Find out what characterizes it, how to record it in accounting, and what differentiates it from a sales invoice.

In our articles on these subjects, you can also deepen your knowledge of other integral documents, such as the deposit, situation, and balance invoices.

What’s in this article?

• What is a purchase invoice?
• How to distinguish a purchase invoice from a sales invoice
• What to do with a purchase invoice
• Who can issue a purchase invoice?
• How to edit a purchase invoice

What is a purchase invoice?

The purchase invoice is a document provided to the customer from their supplier following a professional expense (buying of a good or a service). The client company obtains it when the goods are delivered or after the service is completed. The document is mandatory for all commercial transactions between companies (business-to-business or B2B) to formalize the acquisition.

How to distinguish a purchase invoice from a sales invoice

The name differs depending on your role in the transaction. If you are the buyer or the client company, you will receive a purchase invoice once payment is made. Conversely, if you provide a product or service to your customer, the document you issue is called a sales invoice. Hence, we use two names to designate the same thing: a legal and fiscal document that formalizes the commercial transaction.

What to do with a purchase invoice

The client company must account for the purchase invoice. This allows it to keep accurate accounts that comply with tax regulations.

The purchase invoice also constitutes proof of professional expenditure—it is important for the deductibility of value-added tax (VAT) on the acquisition during the VAT declaration. Furthermore, it might be requested of you in case of a dispute or tax audit. Therefore, you must keep each purchase invoice for 10 years at a minimum.

Recording of the purchase invoice

Recording each purchase invoice must be done on the date of receipt (the date appearing on the document). To reflect it in your books, debit the amount excluding tax (HT) from the following account numbers:

• 607 for “purchases of goods” intended to be resold without transformation
• 601 for “stored purchases of raw materials and supplies”
• 609 for any “discounts and rebates” applied, where applicable

It will also be necessary to account for VAT by the following numbers:

• Debiting account 44561 for “deductible VAT on other goods and services”
• Crediting the 401 “suppliers” account for the amount all taxes included (TTC) paid to the supplier

Who can issue a purchase invoice?

Companies alone (whatever their legal status) can edit invoices. Individuals who make sales equal to or greater than €1,500 must draw up a certificate or a contract under private signature to justify a transaction between two parties.

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How to edit a purchase invoice

The issuing company, i.e., the supplier, is required to generate a sales invoice to materialize each transaction. Once in the hands of the client company, it becomes a purchase invoice. All invoices must contain the following:

• The word “invoice,” invoice number, and its issue date
• The supplier’s identity: their first and last name or corporate name, their SIREN or SIRET number, the legal form of the entity, the amount of share capital, the RCS number for traders or the RM number for craftspeople, and the address of the head office
• The customer’s identity: their name or company name and their billing and delivery address (if they are different)
• VAT numbers of the subject companies
• The purchase order number (if applicable)
• Date of the sale or completion of the service
• A designation and detailed account of each good sold or service provided: unit, quantity, nature, brand, reference, materials supplied, and labor
• The unit price, excluding tax on each good or service
• Possible increases, such as delivery or travel costs (if applicable)
• Possible reductions
• Total amount, excluding tax
• The VAT rate applicable to each item, or the mention of “VAT not applicable, Art. 293 B of the General Tax Code” for non-paying companies
• VAT amount
• The total amount, including tax
• The deadline and terms of payment
• The rate of late payment penalties in the event of nonpayment by the due date
• The amount of the fixed compensation for recovery costs