Keeping its accounts up to date is key for a company’s successful performance. Accounting provides business owners with a more in-depth view of their business’ financial position at any point in time. Accounting ledgers and invoices are only some of the tools that can help you have better control of your company’s finances.
Invoices are valuable documents that allow for debt to be accounted for in favor of the seller, as well as for warranty claims for goods, products, or services to be made. Throughout this entry, we will explore the importance of invoicing over not invoicing.
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To invoice or not to invoice
For an invoice to be valid, it must contain all taxpayer data, including the customer’s Federal Taxpayer Registry Code (RFC) and address, as well as the date and the amount being charged. This information is key for annual tax declarations and any potential deductions.
Why should businesses issue invoices?
The Tax Procedure Law (L11683) establishes nationwide sanctions for failure to issue invoices. Local businesses could be forced to close or be fined. A proper accounting system is the one way to avoid these sorts of conflicts.
Both natural persons and legal persons can invoice.
The Tax Administration Service (SAT) mandates that both natural persons and legal persons can write invoices. Natural persons are even allowed to create their invoices for free simply with their e-signature. Learn more about this on SAT’s official website.
Businesses have the responsibility to issue invoices as proof of their sales and activities, while customers have the right to get them, use them for their tax declarations, and request deductions based on them. In that case, tax refunds can be requested by the end of the fiscal year.
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At QuAdrans Law and Finance, we know that invoices are some of the most important documents for successful business transactions to take place. That is why our professional accountants will orient you to make the best financial decisions for your company. Contact us.
Learn more about our accounting service by clicking here.
