Correcting an invoice in Germany: which route for which error?

Which route fits?

An invoice that has reached the customer stays as it is. That is what GoBD (the German Finance Ministry's rules for electronic bookkeeping) and the German Fiscal Code require: bookings and records may not be changed in a way that makes the original content impossible to determine (§ 146(4) AO, German; for electronic documents GoBD margin nos. 58 and 59, German). Every correction is therefore an additional document. Which one depends on the type of error:

Wrong details: correcting invoice

If a required detail is missing or wrong, you correct the invoice without canceling it. The correcting invoice (berichtigende Rechnung) is a document that refers specifically and unambiguously to the original invoice and only corrects the missing or incorrect details (§ 31(5) UStDV, German). The original invoice remains, and both documents belong together. If the sale is subject to the e-invoicing mandate, the correction must also be an e-invoice (section 14.11(1) sentence 7 UStAE, German).

Typical cases are a mistyped street, a forgotten company name or a missing VAT ID. What matters is that the invoice recipient stays the same. If the invoice is supposed to name a different person or company, that is not a correction but a change of recipient. If the invoice really was addressed to the wrong recipient, you cancel it and issue a new one to the actual recipient of the supply.

The details on addresses, with examples and the special case of pay-by-invoice, are in the playbook changing the billing address afterward.

Wrong amount or VAT rate

If the amount is wrong, you applied the wrong VAT rate or you forgot a line, the clearest route is a cancellation invoice for the original invoice, followed by a new, correct invoice. Legally, a correction under § 31(5) UStDV (German) would also be possible here, because a wrong amount is also an incorrect detail. The cancellation invoice repeats the lines with negative amounts and states the number and date of the original invoice. Both documents get their own numbers.

With the VAT rate, it pays to act fast. If your invoice shows more VAT than is legally owed, you owe the amount shown until you have corrected the tax amount toward the customer (§ 14c(1) UStG, German). If you showed too little, you still owe the legal tax: the taxable amount is the value of the consideration minus the VAT legally owed (§ 10(1) sentence 2 UStG, German). The tax is then mathematically contained in the gross amount and cuts into your margin.

Whether a VAT rate is right is often the real question, for example for shipping costs on mixed baskets. More on that under shipping costs and VAT.

Refunds and partial refunds

If you refund money to a customer, the taxable amount for VAT changes (§ 17(1) UStG, German). The tax authorities do not require a correction of the original invoice for this (section 17.1(3a) UStAE, German). The reduction is still best documented with a cancellation invoice: for a full refund over the whole amount, for a partial refund only over the refunded part, such as a returned item. You correct the VAT in the reporting period in which the refund happens, not retroactively in the month of the original invoice (§ 17(1) sentence 8 UStG, German).

Do not call this document a "Gutschrift". In German VAT law, a Gutschrift (usually translated as credit note) is something else: an invoice that the customer issues for their supplier (§ 14(2) sentence 5 UStG, German). "Stornorechnung" (cancellation invoice) or "Rechnungskorrektur" (invoice correction) is unambiguous.

Extra purchases and upsells

If your customer buys something extra after checkout, for example through a one-click upsell or a follow-up order by email, the first invoice has not become wrong. It is a new sale. So you do not correct anything; instead you issue a separate, complete invoice for the additional items only, with its own invoice number.

German VAT law has no rule of "one order, one invoice": an invoice is any document that bills for a supply of goods or services (§ 14(1) sentence 1 UStG, German). A reference to the order number is enough for your customer to match both invoices. Shipping costs already on the first invoice stay there; only additional shipping costs go on the second.

What would be wrong is overwriting the first invoice with the new total, as some PDF plugins do. How this works automatically for WooCommerce upsells is shown in upsell after checkout: follow-up invoice.

When you correct nothing

Two cases look like corrections but are not:

• Returned direct debit or chargeback. The customer gets the money back through their bank, but they did receive the goods or service. The invoice stays correct, and your receivable revives. A cancellation invoice would be wrong here, because it reduces revenue and tax even though the customer still has to pay.
• Unpaid invoice. If a customer does not pay, the invoice stays as well. Only when the receivable actually becomes uncollectible does your bookkeeping correct the VAT as a bad debt (§ 17(2) no. 1 UStG, German).

What you must never do

• Overwrite or delete an issued invoice, or regenerate it with the same number and different content.
• Use an invoice number twice. Each number is assigned only once (§ 14(4) sentence 1 no. 4 UStG, German).
• Send a corrected invoice as a second complete invoice without canceling the original or referring to it as a correction. Then two invoices exist for the same supply, and the tax from both may be owed (§ 14c(1) UStG, section 14c.1(4) UStAE, both German).
• File the original and the correction separately. They belong together and are kept for eight years (§ 147(3) AO, § 14b(1) UStG, both German).

How it works in Rechnungskit

Rechnungskit never changes a finalized invoice. Corrections come from what happens in your shop or at your payment provider:

• Refund in the shop or at the payment provider: Rechnungskit creates the cancellation invoice automatically, accurate to the cent for partial refunds too.
• Wrong billing address: you correct it directly on the invoice. A correcting invoice is created under the same number, without a second DATEV booking.
• Extra purchase or upsell: Rechnungskit detects the grown order, matches the second payment against the difference and creates a separate invoice for the added items.
• Returned direct debit: no cancellation. The receivable shows as open again and lands with you as a task.
• Manual orders: there is no event from a shop here, so you cancel them yourself, with a required reason.

All documents sit together in the GoBD archive and go to your tax advisor (Steuerberater) with the DATEV export. DATEV is the accounting software most German tax advisors use.