Invoicing method

The invoicing method (faktureringsmetoden) means that customer invoices are recorded as income and a receivable when they are sent, and supplier invoices as an expense and a liability when they are received. The payment is then recorded as a separate transaction that settles the receivable or the liability.

The method is the main rule and is mandatory for businesses whose net turnover normally exceeds SEK 3 million. It gives an ongoing picture of what the company is owed and what it owes, which is essential for managing cash flow.

VAT is reported in the period in which the invoice is dated, not when it is paid. This means that VAT may have to be paid before the customer has paid, something that should be factored into cash flow planning.