A VAT registered business needs to issue a VAT invoice when supplying goods or services to other VAT registered businesses.
ISSUING VAT INVOICES: The bills contain information required under the rules of Value Added Tax.
VAT invoices can only get issued by companies already registered for Value Added Tax. The business will need to:
In most cases, commercial invoices will already contain the correct information. They get used to calculate tariffs and international commercial terms. Thus, commercial invoices are often used for customs purposes.
Note: The business can only reclaim VAT on a valid invoice. Pro-forma invoices, delivery notes, statements, or invalid invoices are not valid.
As a rule most transactions will use a full VAT invoice. In some cases, the business can issue a modified VAT invoice for retail supplies over £250.
For retail supplies under £250 the business can use a simplified VAT invoice. Since the 1st of January 2013 a simplified invoice also applies to some other supplies.
|Information to be Included in a VAT Invoice||Full VAT Invoice||Simplified VAT Invoice||Modified VAT Invoice|
|A unique invoice number following on from the previous invoice||Required||Required||Required|
|The name and address of the business||Required||Required||Required|
|The business VAT number||Required||Required||Required|
|The date of sale||Required||Not Required||Required|
|Tax point or 'time of supply' if different from the invoice date||Required||Required||Required|
|Trading name and address of the customer||Required||Not Required||Required|
|A description of the goods or service||Required||Required||Required|
|The total amount excluding Value Added Tax||Required||Not Required||Required|
|The total amount of Value Added Tax||Required||Not Required||Required|
|The price of each item excluding Value Added Tax||Required||Not Required||Required|
|The quantity of each item excluding Value Added Tax||Required||Not Required||Required|
|The rate of any discount applied to the sale||Required||Not Required||Required|
|VAT rate per item (clarify 'no VAT' for exempt or zero-rated items)||Required||Required*||Required|
|The total amount including Value Added Tax||Not Required||Required*||Required|
Note: *Means show the information for each item if they get charged at different VAT rates.
If your company is using the Cash Accounting System you must stamp an invoice with the date and amount paid. If you use the VAT Margin Scheme there are different rules for invoicing and record keeping.
As a rule, you must issue an invoice within 30 days of the date of supply 'tax point' of goods or services. The invoice deadline would be the date of the payment if you paid in advance.
If the company is trading internationally the invoices may not be in sterling (GBP). If VAT invoices get issued in a foreign currency or a foreign language they must show:
If your business needs to convert to sterling it can use:
Note: Different rules apply if your business uses the Tour Operator's Scheme.
There is no need for your business to write an invoice for Value Added Tax if:
VAT Invoices: What Should be Included in a VAT Invoice in the United Kingdom?