Tax Invoice Template
This Tax Invoice Template is designed to be used in connection with the provision of goods or services where sales tax or VAT is chargeable. The collection of sales tax and VAT creates a serious legal obligation on the recipient and collecting tax without authorization is an offense. In addition there may be complex local rules about what items are subject to tax and at what rate as well as in which cross-border transactions tax or VAT should be charged. If you are unsure as to whether you should charge VAT or sales tax you should confirm with an accountant. If you prefer to start with a Blank Invoice you should use our Blank Invoice Template or you could consider using either our Services Invoice Template or Sales Invoice Templates (for the sale of goods). If you are looking for a non-fiscal invoice (or informal request for payment) you should use our Proforma Invoice Template. This Tax Invoice Template is suitable for commercial use and is written with a natural person in mind (as opposed to a company) but this can be easily changed if necessary. If you use this Tax Invoice Template for a company you should include all details from your company’s letterhead (full company name, registration number, logo etc).
Invoice Number: [INVOICE NUMBER]
Many people get confused about what invoice number to choose. The only requirement is that each invoice should have a unique reference number (otherwise things get very confusing when it comes to doing accounts). The simplest way to number invoices is numerically starting from 1 (1, 2, 3, etc) and this is also the easiest method from a bookkeeping point of view however some people prefer not to use this approach since it gives their clients an indication of their number of transactions. Other options include using larger numerical increments (137, 146, 154, etc), using the year as part of the invoice numbers (2015/0001, 2015/0002, 2015/003 etc), using the client’s name as part of the invoice number (Jones001, Jones002, Jones003). If you are worried about keeping track of the numbers the simplest option is just to use the date in reverse (e.g. Invoice Number 140704 for an invoice raised on 4th July 2014).
Our Tax Number: [TAX NUMBER]
Your Tax Number (if applicable): [TAX NUMBER]
Local requirements for displaying tax numbers and reference number vary, in general showing both your own and your client’s tax reference or VAT number should be sufficient but if in doubt you should check with an accountant.
In this example we use a sales tax rate of 6% and assume it applies to goods but not general services or delivery however both the rate and applicability of sales tax or VAT varies from state to state and country to country. It is very important that you make clear exactly how much tax you are collecting.
Amount Due: [AMOUNT DUE]
In our example the amount due is $84. Don’t forget, when dealing with cross-borders transactions you should include the currency.
Payment terms: [PAYMENT TERMS]
Typical payment might include the following: “immediately on receipt of invoice”; “within 7 days”; “within one calendar month.”
Remittance: [REMITTANCE METHODS]
Here you should list all the ways that you can be paid. If you accept payment by wire you should include your full bank coordinates as well as the bank’s name and address. Remember to check with your bank if there is a charge for inbound payment, especially if you are dealing in different currencies. You should also be sure to include any reference you wish the payee to include (such as “ensure that invoice number is referenced when making payment”). If you accept checks you may wish to specify “checks must be account payee only” and if you want to receive funds by Paypal be sure to include your Paypal email address.
Shipping: [SHIPPING DETAILS]
If the invoice contains goods which need to be shipped (or items which need to be collected) you should include this on the invoice. For example: “Goods will ship within 48 hours of receiving cleared payment”; “Car can be collected from 1123 Sudden Valley Estates any time from noon next Thursday.”