close menu

How to create a VAT invoice

by Kobus Van den Bergh | Oct 11, 2016
  • Whether you are a freelancer, a sole-trader or a contractor in the UK, it’s essential to know how to create a valid VAT invoice. We share a few basic facts and tips to help you out.
    VAT invoice

    The basics

    Value added Tax (VAT) is charged on sales made. As a standard VAT-registered business, you charge VAT on sales and can claim VAT on purchases made from other VAT-registered businesses.

    VAT invoices are not the same as:

    • Pro-forma invoices
    • Invoices that include the phrase “this is not a tax invoice”
    • Statements
    • Delivery notes
    • Customer orders
    • Quotations

    What must be included on a VAT invoice?

    A VAT invoice must include the following to be recognised by HMRC:

    • A unique, sequential invoice number
    • Your name or trading name and address
    • Your VAT registration number
    • The invoice date
    • The time of supply, also referred to as “tax point”, if this is different from the date above
    • The customer’s name or trading name and address
    • A description of the goods or services supplied

    In addition to this general information, you’ll need to show a breakdown for each different item or service listed on the invoice:

    • Unit price excluding VAT
    • Quantity of goods or the details of the service
    • Rate of VAT that applies to the item or service
    • Total amount payable, excluding VAT
    • Rate of any cash discount, if applicable
    • Total amount of VAT charged

    When can you use a simplified VAT invoice?

    If you need to invoice for goods or services for £250 or less, including VAT, you are able to supply a simplified invoice. This will need to show:

    • Your name and address
    • Your VAT registration number
    • The time of supply (tax point)
    • A description of the goods or services

    There’s better news still – you don’t need to issue a VAT invoice if:

    • Your invoice only lists exempt or zero-ratedsales within the UK
    • You’re giving goods as a gift
    • You sell goods under aVAT second-hand margin scheme
    • Your customer operates a self-billing arrangement

    Make sure you’re on the right side of HMRC. Our team of experienced accountants are able to guide you, so you can get down to business. Contact us on +44 (0) 808 141 1643 to get started.

    We are a professional services company that specialises in cross-border financial and immigration advice and solutions.

    Our teams in the UK, South Africa and Australia can ensure that when you decide to move overseas, invest offshore or expand your business internationally, you’ll do so with the backing of experienced local experts.

    • Contractor choosing door
      Contractor insurance: Choosing the right cover for your risks
      Mar 12, 2019  |  by Kobus Van den Bergh
    • Making Tax Digital for VAT
      Making Tax Digital for VAT deadline: What you need to know before April 2019
      Feb 18, 2019  |  by Scott Brown
    • Businessman-running
      Did you overpay HMRC? Here’s how to get your tax refund
      Feb 07, 2019  |  by Kobus Van den Bergh
    • Business
      Will 2019 be a good year for UK contractors? IR35 and the loan charge
      Jan 24, 2019  |  by Ashley Deakin
    • Business-concept
      Moving your business to the UK? You’ll need to understand the UK’s VAT regulations
      Nov 12, 2018  |  by Scott Brown
    • Autumn-statement-banner-no-logo-white
      Highlights from the 2018 Autumn Statement
      Oct 30, 2018  |  by Scott Brown
    • man-in-front-of-shop
      A quick guide to UK business tax
      Oct 26, 2018  |  by Scott Brown
    • working-man-contractor
      Self-employment vs. contracting in the UK: What’s the difference?
      Oct 11, 2018  |  by Kobus Van den Bergh
    • man-relaxing
      Why your SME needs management accounting
      Oct 10, 2018  |  by Scott Brown
    • yes no cross tick
      HMRC’s employment status test continues to frustrate UK contractors
      Sep 24, 2018  |  by Kobus Van den Bergh
     
     

    South Africa

    Cape Town

    Regent Square
    Doncaster Road
    Kenilworth 7708 +27 (0) 21 657 2120

    Durban

    25 Richefond Circle
    Ridgeside
    Umhlanga 4320 +27 (0) 31 536 8843

    United Kingdom

    Croydon

    One Croydon
    12-16 Addiscombe Road
    Croydon CR0 0XT +44 (0) 20 7759 7514

    Australia

    Melbourne

    9 Yarra Street
    South Yarra
    VIC 3141 +613 (0) 8651 4500

    Sable International is a trading name of 1st Contact Money Limited (company number 07070528), registered in England and Wales. We are authorised and regulated by the Financial Conduct Authority in the UK (FCA no. 517570), the Financial Services Conduct Authority in South Africa (1st Contact Money [PTY] Ltd - FSP no. 41900) and hold an Australian Financial Services License issued by ASIC to deal in foreign exchange (1st Contact Group - AFS License number 335 126).

    We use cookies to provide the best website experience for you. Using this website means that you agree to this. How we use cookies.