From Receipt Photos to Accounting: The Problem With Expenses That Have No Invoice

Most articles on this topic tell you the same thing: "with a till receipt you can't deduct VAT." That is wrong often enough to cost you money. Under Spanish law, a simplified invoice (the fiscal name for a till receipt) is valid for deducting VAT — as long as the issuer prints two extra things on it: your tax number and the VAT amount shown separately. That requirement is written into article 7.2 of Royal Decree 1619/2012, the invoicing regulation, and it applies to any receipt within the simplified-invoice limits: €400 including VAT as a general rule, or €3,000 for retail, hospitality, transport, taxis, hairdressers, tolls and a short list of similar activities.

So the real question is never "receipt or invoice?" It is: does this piece of paper carry my tax number and a separate VAT line? Everything else follows from that. Here is the second thing nobody puts up front: you are not stuck with the answer you got at the till. When the buyer is a business acting as such, the supplier has until the 16th day of the month following the transaction to issue the proper invoice (article 11 of the same regulation). That gives you a hard, dateable deadline for chasing exchange invoices — not a vague "ask them at some point."

Do the arithmetic before you decide it doesn't matter

Owners tend to wave this off as small change. It usually isn't. Take the receipts that actually pile up in a small business — fuel, parking, hardware store, courier, client lunches, printer cartridges, cleaning supplies — and run the numbers with your own figures:

Receipts per month that never become proper invoices: N
Average amount including VAT: A
Standard Spanish VAT rate: 21% (the VAT inside a gross amount is A × 21 / 121)

Annual VAT you never recover = N × A × 0.1736 × 12.

At 25 receipts a month averaging €30, that is €1,562 a year of input VAT you simply hand over. At 60 receipts averaging €45, it is €5,625. That number is not a rounding error for a business with a €120,000 turnover — and it repeats every year. The same silent leak shows up in quarterly filings; we broke down the mechanics of it in the deductible input VAT you lose every quarter.

Three documents, three different legal outcomes

It helps to stop calling everything "a receipt." In practice you hold one of three things:

1. A plain till receipt (simplified invoice without your details). It shows the seller's tax number, the date, the items and the total. VAT is not deductible from it, because nothing on the paper says the purchase was made by you. The expense itself may still reduce your income-tax base if you can show it was necessary for the activity — income tax rules ask for proof, not specifically for a full invoice — but the VAT is gone.

2. A qualified simplified invoice. Same small piece of paper, plus your tax number, your address and the VAT charged shown separately. This one supports both the expense and the VAT deduction. Many petrol stations, hardware chains and restaurants will print it if you ask *before* they close the sale — it takes them ten seconds and is impossible afterwards on some tills.

3. A full invoice (or an exchange invoice). Complete details of both parties, invoice number and series, taxable base and VAT. This is what you want for anything sizeable, and it is the only option above the €400 / €3,000 ceilings. If you collected several receipts from the same supplier — the restaurant you use for client lunches, the local hardware store — you can ask them to replace the lot with one exchange invoice covering the period.

The paper disappears before the tax authority does

There is a second failure mode that has nothing to do with the fields printed on the receipt: the receipt stops being readable.

Almost all till receipts are thermal paper. The print is a heat-triggered chemical reaction that keeps reacting to heat, light, humidity and friction after it leaves the printer. Paper manufacturers' own guidance is that a receipt kept cool, dark and dry stays legible for roughly six to twelve months; one that spends the summer in a van's glovebox or a jacket pocket can go blank in weeks.

Now compare that with your retention obligation: invoices received must be kept for the tax limitation period under the General Tax Act — four years — and commercial law pushes bookkeeping records to six. A blank strip of paper in a shoebox is not documentary evidence of anything. You will not discover this at the moment of purchase; you will discover it during an inspection, three years later.

The practical answer is to digitise at the moment of the transaction, not at quarter-end. Note the nuance if you want to throw the paper away: in Spain, keeping only the digital copy and destroying the original legally requires "certified digitisation" software approved by the tax agency, which signs each image electronically. If you are not using approved software, keep the paper as well — but keep the readable digital image regardless, because that is the copy that will still exist in year four.

A procedure that actually survives contact with a workday

The rule that fails is "put the receipts in the folder." People don't. The rule that works is one that costs less effort than losing the receipt does.

Fix the point of purchase. Give everyone who spends company money one sentence to say: "Invoice with the company tax number, please." Print the tax number on a card in each wallet. This single habit converts most of the loss at zero cost.
Photograph it on the spot, before it leaves your hand. Not at the end of the week. The photo is taken while the print is still sharp and the memory of what it was for is still fresh.
Record the purpose immediately. Two words are enough: "client lunch — Martínez", "materials — Calle Mayor flat". The expense's link to the business activity is what a tax inspector questions, and reconstructing it eleven months later is guesswork.
Extract the data automatically. Date, supplier, tax number, base, VAT rate, VAT amount, total. Whether that lands in a spreadsheet, your bookkeeping software or your accountant's inbox matters less than that nobody retypes it.
Sweep for missing invoices before the 16th. Once a month, list every receipt over your own threshold (many businesses use €50) that lacks your tax number, and request the exchange invoice while the supplier is still inside the legal issuing window.
Hand it over clean. Your accountant should receive files that are already legible and labelled, not a bag. There is a short checklist for that in how to prepare your supplier invoices before handing them to your accountant.

Step 4 is where most small businesses stall, because typing twenty-five receipts a month into a spreadsheet is exactly the kind of job that gets postponed until it is a hundred. Sending the photo to a WhatsApp number that returns the structured fields removes the postponement — nobody has to open a laptop. That's the model behind automating invoice extraction over WhatsApp, and it applies to crumpled thermal receipts just as much as to A4 PDFs.

A warning on expectations: a receipt that is already faded, creased across the total, or photographed at an angle in a dark car park will not extract cleanly, by any tool. Good OCR reads bad paper better than a human does at speed, but it cannot read ink that is no longer there. We mapped where that limit sits in extracting data from a bad scanned PDF. This is the strongest argument for photographing at the till.

If you operate outside Spain

The shape of the problem is identical across southern Europe; only the thresholds move.

Italy: simplified invoices can be issued up to €400 since the ministerial decree of 10 May 2019 (previously €100), and must carry the customer's VAT number or tax code. A plain *documento commerciale* handed to an anonymous customer does not support VAT deduction.
Portugal: article 40 of the VAT Code allows simplified invoices up to €1,000 for retail sales to non-taxable persons and up to €100 for other supplies. The buyer's NIF is mandatory when the buyer is a taxable person — which is precisely what makes the document usable, and what feeds it into e-Fatura.

One more note for Spain, because it comes up: the Verifactu regime does not solve any of this. It governs how *issuing* software must record and sign invoices, and its start dates were pushed back by a year — to 1 January 2027 for corporate taxpayers and 1 July 2027 for self-employed individuals. It will make the invoices you receive more standardised. It will not put your tax number on a receipt you forgot to ask for.

The short version

A till receipt is not a lost cause and not a free pass. Ask for your tax number on it at the counter; photograph it before it fades; chase the exchange invoice before the 16th of the following month; and let software do the typing. The gap between doing that and not doing it is a four-figure sum for most small businesses, every year.

If you want to see what a photo of a receipt turns into as structured data, you can try the free extractor — no signup: upload one, get the fields back.

Frequently asked questions

Can I ever deduct VAT from a till receipt?

Yes, if it is a qualified simplified invoice: it must show your tax number, your address and the VAT charged as a separate amount, and stay within the €400 (or €3,000 for certain sectors) limit. Without those fields, the VAT is not deductible.

Is the expense still deductible for income tax if I only have a plain receipt?

It can be, but it is weaker ground: you must be able to prove the expense was necessary for the activity and that you incurred it. The VAT, in any case, is lost. Treat a plain receipt as a partial recovery, not as a normal way of operating.

How long do I have to ask the supplier for a proper invoice?

In Spain, when the customer is a business acting as such, the invoice must be issued before the 16th day of the month following the transaction (article 11, RD 1619/2012). Use that date as your monthly cut-off for chasing exchange invoices.

Can I throw the paper away once I've photographed it?

In Spain, keeping only the digital copy and destroying the original requires certified digitisation software approved by the tax agency (Order EHA/962/2007), which electronically signs each image. If you don't use approved software, keep the paper — but keep the digital image too, because the thermal print will not survive the retention period.