Cancellation invoice (Stornorechnung) and invoice correction in Germany: how to correct an invoice properly

Why you cannot simply change or delete an invoice

As soon as an invoice has been issued, it is an accounting voucher. The GoBD require vouchers to be stored unalterably and every change to remain traceable (§ 146 Abs. 4 AO). If you delete an invoice or reuse its number, a gap or a duplicate arises in the number sequence – in a tax audit a classic reason for questions or even an estimate. Why this is so important is explained in the guide on the GoBD.

In addition, the invoice is already with the customer and may already have been booked. A silently changed version would create two different documents with the same number. The correct approach is therefore always a new document that refers to the original invoice. As long as an invoice is only a draft and has not yet reached the customer, on the other hand, you may change or discard it freely.

Three ways to a corrected invoice at a glance

Which way fits depends on what is wrong – a missing detail, the whole invoice or just the amount:

Invoice amendment: adding missing mandatory details

If a mandatory detail under § 14 Abs. 4 UStG is missing or wrong, the invoice can be amended under § 31 Abs. 5 UStDV. A document that specifically and unambiguously refers to the original invoice (invoice number and date) and contains only the missing or incorrect details is sufficient. Only the person who issued the invoice may amend it – the customer can only ask for the amendment.

This matters for your customer because without a proper invoice they may not deduct input VAT (Vorsteuer). The good news: according to the case law of the CJEU (EuGH) and the BFH, the amendment takes effect retroactively from the date of the original invoice if it already contained the minimum details – issuer, recipient, description of the service, amount and separately shown VAT. The customer therefore does not lose their input VAT deduction retroactively and does not have to pay interest. An amendment is possible until the end of proceedings before the fiscal court.

In practice, many still choose cancellation and a new invoice, because the customer then receives a complete, clean document. Both are permitted.

• Date or period of supply missing → an amendment is enough.
• Customer’s address or company name misspelled → an amendment is enough.
• Your tax number or VAT ID missing → an amendment is enough.
• Invoice addressed to the wrong customer → cancellation and a new invoice, because the recipient is a different one.

Cancellation invoice: content and example

The cancellation invoice fully reverses the original invoice. It contains the same items with negative amounts, the same tax rate and the note „Stornorechnung zur Rechnung Nr. … vom …“ (cancellation of invoice no. … dated …). It gets its own sequential number and its own date. Afterwards – if the service is still to be billed – you issue a new invoice with a new number. The mandatory details of every invoice are explained in the guide writing invoices.

Example: you billed a client for 15 hours of consulting at €100, but 12 hours had been agreed.

Invoice correction for a discount, return or complaint

If the service was billed correctly and only the price changes later, you do not have to cancel the whole invoice. An invoice correction for the difference is enough: it refers to the original invoice and shows the reduction amount with the VAT on it as negative amounts.

For VAT purposes, the reduction under § 17 UStG takes effect in the return period in which the price changes – not retroactively in the month of the invoice. Example: invoice dated 20 January for €4,000 net plus €760 VAT; in April you agree on a 10 % discount because of a defect. The invoice correction from April is for −€400 net and −€76 VAT and reduces the advance VAT return (Umsatzsteuer-Voranmeldung) for April (or the second quarter). Your customer must repay €76 of input VAT in the same period.

An early-payment discount (Skonto) is also a price reduction. You do not need a separate correction for it if the discount terms are already on the invoice; you simply book the discount deduction when the payment comes in.

Credit note (Gutschrift): commercial or VAT meaning?

In everyday German, any refund is called a „Gutschrift“ (credit note). In the VAT Act, however, a Gutschrift is something else: an invoice issued by the recipient of the service on behalf of the supplier (§ 14 Abs. 2 S. 2 UStG, self-billing), for example when a publisher bills its authors’ fees. Such a Gutschrift must contain the word „Gutschrift“ (§ 14 Abs. 4 S. 1 Nr. 10 UStG), and the supplier may object to it.

Incorrect VAT shown: § 14c UStG

If you show more VAT on an invoice than you owe, you still owe the excess amount (incorrect tax statement, unrichtiger Steuerausweis, § 14c Abs. 1 UStG) – until you correct the invoice. Typical cases: 19 % instead of 7 %, or VAT on a VAT-exempt service or on a reverse charge service. The correction only takes effect in the period of the correction; if the customer has already paid the excessive amount, you must refund the difference to them before you get the tax back.

An invoice accidentally issued twice for the same service also falls under § 14c Abs. 1 UStG – one more reason to cancel the second one immediately. The tax statement is unauthorised (unberechtigt), on the other hand, if there is no service at all behind it or the issuer is not allowed to show VAT (§ 14c Abs. 2 UStG). Then you must correct the invoice towards the customer and apply to the tax office for a refund of the tax; this only works once the customer has not deducted input VAT or has repaid it. Since 2025, a small business (Kleinunternehmer) that shows VAT generally owes it under § 14c Abs. 1 UStG – with an exception for invoices to private customers (BMF letter of 18 March 2025).

If you show too little VAT, you still owe the correct tax. It is calculated out of the invoice amount: with €1,070 gross at 7 % instead of the correct 19 %, you owe €170.84 (€1,070 ÷ 1.19 × 0.19) instead of €70. Here it pays to cancel quickly and re-invoice before the customer pays.

Number sequence, deadlines and the turn of the year

The cancellation invoice needs its own unique number. Whether it comes from the invoice number sequence or from a separate sequence such as “ST-2026-…” is up to you – what matters is that every number occurs only once and the sequence remains gapless. You may never reuse the old invoice number.

• Cancellation in the new year: the cancellation invoice bears the current date and a number of the new year; you correct the VAT in the current advance return, not in the previous year’s.
• In the EÜR the cash flow counts: if you have already received money and refund it, the repayment reduces your business income in the year of payment.
• You must keep both the original invoice and the cancellation invoice – invoices as accounting vouchers for eight years.
• If your customer has already paid, you refund the amount or offset it against the new invoice; note the offset on the new invoice.

Cancelling or correcting an e-invoice

If you issued the original invoice as an e-invoice, the amendment, cancellation invoice or invoice correction must also be an e-invoice. A PDF marked „Storno“ is then not enough. The correction usually carries code 381 (credit note) as the invoice type (BT-3) and refers to the number of the original invoice in field BT-25, and for public authorities also uses the same Leitweg-ID. Which codes and formats exist is explained in the guide on XRechnung and ZUGFeRD.

A ZUGFeRD PDF edited afterwards is not a correction but a second, different invoice. Here too: a new document with a new number, and archive the original unchanged.

Correcting invoices with Kontelio

In Kontelio an issued invoice cannot be changed. With “Cancel invoice” Kontelio immediately creates and issues a cancellation invoice for the full amount; with “Cancel and create a corrected invoice” you also get a new draft with the details of the old invoice. For a discount or a return you create an invoice correction (Credit note) and enter the quantity to be corrected for each line.

Each correction gets a number from its own number sequence, refers to the number and date of the invoice, takes over the tax rates and reduces turnover and VAT in the period of its date. In German, Kontelio deliberately never calls it a „Gutschrift“. If the invoice was an e-invoice, the correction follows the same format. More about Kontelio’s invoicing software.

Frequently asked questions