Supplier invoices: why the ICE matters for deductible VAT

Programme in preparation. No service is open to the public at this stage. This article is general information: it replaces neither your accountant's advice nor the tax texts in force.

For a business subject to VAT, a supplier invoice is more than proof of purchase. It is often the document that allows the VAT paid on that purchase to be deducted. An incomplete or lost invoice can therefore cost far more than an administrative slip. Among the items to check, the supplier's ICE deserves particular attention.

Deductible VAT in two lines

A business collects VAT on its sales and pays VAT on its purchases. It then passes the difference on to the tax administration:

VAT to pay over = VAT collected − deductible VAT

Only VAT backed by a proper invoice can go into the second term. A missing or incomplete document can therefore raise the amount to pay over.

A worked example

Take a salon subject to VAT at 20%. Its sales for the month come to 60,000.00 DH including tax, which is 50,000.00 DH excluding tax and 10,000.00 DH of VAT collected. Its purchases for the month come down to three invoices:

If all three invoices are in order, the salon pays over 10,000.00 − 4,000.00 = 6,000.00 DH. If the deduction on the third invoice is set aside, it pays over 10,000.00 − 3,600.00 = 6,400.00 DH. The 400.00 DH gap is a cost that a complete invoice would have avoided.

To find the VAT inside an amount including tax, divide by 6 at the 20% rate and by 11 at the 10% rate: 1,200.00 DH including tax holds 200.00 DH of VAT, and 1,100.00 DH including tax holds 100.00 DH.

Why the ICE in particular

The Common Company Identifier, or ICE, is a 15-digit number that identifies a business uniquely across public administrations. On an invoice, it ties the purchase to a precisely identified supplier. Without it the document is incomplete, and the VAT deduction can be questioned during a tax review.

A missing item says nothing about the supplier's good faith. Most often it is an old invoice template or a simple oversight, and asking for a corrected invoice is enough. A clear request also helps the supplier keep its own documents up to date.

What to check on receipt

The mandatory items are set by the General Tax Code. In practice, before filing an invoice, check at least:

• the supplier's name or company name and address;
• its ICE and its tax identifier;
• the invoice number and date;
• your own identity, with your ICE when you are a business;
• the detail of the goods or services;
• the amount excluding tax, the rate, the VAT amount and the total including tax;
• the method of payment.

If an item is missing, ask for a corrected invoice straight away: it will be much harder to obtain several months later.

Three habits that protect the deduction

• Ask for the invoice at the time of purchase, even for small amounts.
• Pay by a traceable means: card, transfer or cheque. Tax rules limit the deduction of purchases paid in cash above certain thresholds, and your accountant can tell you which ones apply.
• File your invoices every month. The right to deduct must be used within limited time, and a document found too late may no longer serve.

Who this concerns

This reasoning applies to businesses subject to VAT. An exempt activity, such as medical care, or a flat-rate regime, such as self-employment or the single professional contribution, follows other rules. The sound habit stays the same: keep clear and complete documents.

What Malak Pro plans

The space planned for merchants, Malak Pro, will include a VAT shield. You will be able to photograph your supplier invoices there: the text will be read on a server, then the supplier, ICE, number, date and VAT will be shown to you for checking. An invoice with no ICE will be flagged, so that you can have it corrected in time. A gauge will show each month the documented deductible VAT and the VAT that remains to be justified.

This tool will help with filing. It will replace neither your accounts nor your tax returns.