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Mandatory details on a trade quote: what really has to be on it

This guide covers German law and practice. A UK edition is in preparation.

A quote is not a small preview of the invoice but a document of its own with its own rules. That explains why many templates from the internet demand details nobody requires, and leave out the ones that matter.

This text describes the legal position according to the sources linked below and does not replace legal advice. Your tax adviser or solicitor is responsible for classifying your own business.

A quote and an invoice are two different documents

The familiar list with tax number, sequential number and separately shown VAT comes from VAT law and applies to the invoice. The quote is an offer to enter into a contract. It binds you to what it says as soon as the customer accepts, and that is exactly why the wording decides more than the formalities.

What is actually prescribed on the quote hangs on two questions: is your business entered in the commercial register, and are you writing to a consumer or to a business.

What a quote has to contain as a business letter

A quote that goes to a specific recipient is a business letter. For registered merchants, § 37a of the German Commercial Code (HGB) requires the company name, the legal form designation, the place of the commercial establishment, the register court and the number under which the company is registered.

For the UG and the GmbH, § 35a of the Limited Liability Companies Act (GmbHG) goes further: legal form, registered seat, register court, register number and all managing directors with surname and at least one first name written out in full. An abbreviated first name does not satisfy the wording.

Type of businessPrescribed on every quote
Sole trader, not in the commercial registerName and an address at which you can be served, so the sender is unambiguous
Registered merchant (e.K.)Company name, legal form suffix, place of establishment, register court, register number (§ 37a HGB)
UG (haftungsbeschränkt), GmbHLegal form, registered seat, register court, register number, all managing directors with first name written out (§ 35a GmbHG)

Anyone not in the commercial register is not subject to § 37a HGB. The name and an address at which you can be reached still belong on every quote: without them the customer does not know who they are contracting with.

For private customers, the gross price decides

This is where most templates get it wrong. Anyone offering services to consumers must, under § 3(1) of the Price Indication Ordinance (PAngV), state the total price, that is the price including VAT. And if the price is broken down, which a quote with line items always does, § 3(3) expressly requires that the total price be highlighted.

A quote to a private individual that shows only net figures does not satisfy the Price Indication Ordinance. The amount the customer pays in the end must be visible and highlighted.

Between businesses that does not apply: in B2B, net prices are usual and permitted, because the ordinance is aimed at consumers. A tiler who mainly works for private households therefore writes quotes differently from a business that works for main contractors.

Small businesses under § 19 UStG

Anyone using the small-business VAT exemption shows no VAT. On the quote that means: no tax rate, no VAT shown, and instead a note explaining why no VAT appears. A quote that nonetheless shows “plus 19% VAT” because the template was set up that way is confusing at best.

What no law requires, but wins quotes

  • A validity period. Without it your price theoretically stays open, even when the material costs more in four weeks.
  • Line items with quantity and unit. Twelve square metres at 46 euros can be checked; “floor tiles, fixed price” is a bargaining chip.
  • A date and a number. Not prescribed, but the only way to mean the same document when talking about “last week’s quote”.
  • A clear exclusion of services. What is not included is best written down too.

The short checklist before sending

  • Is the full sender with legal form on it, and for a UG or GmbH also the register court, register number and the written-out first name of every managing director?
  • Is the quote going to a consumer, and if so, is the gross total highlighted?
  • Does the VAT match your own position, that is, shown or, as a small business, deliberately not?
  • Does every line item have quantity, unit and price?
  • Is a validity period stated?

That is the check Handschlag runs itself before every export, and which blocks the export while something is missing. The difference from a template is not the layout, but that an incomplete quote never becomes a PDF in the first place.

Sources