What must a UK VAT invoice show?

For those company’s that are raising sales invoices, we are often asked during the initial setup stage – what must a UK VAT invoice show? There are standard and expected points that the invoice should show.

Assuming you are VAT registered and you sell goods and/or services to somebody else that is VAT registered (be it an individual, partnership or company), you must provide them with a VAT invoice or receipt. It does not have to be in paper format – it can be an electronic invoice. If you’re not VAT registered, see this page with further information.

Key points to show on the UK VAT invoice

  • An invoice number that is UNIQUE and follows on from the number of the previous invoice even if you cancel and invoice number
  • Your name or trading name & address (if you are a company, need to also show the company number and the registered office address)
  • Your own VAT number
  • Customers name or trading name and address
  • Invoice date (and a tax point date if different from the invoice date)
  • The description of what has been sold/supplied
  • The rate of any cash discount (if applicable)
  • Total amount of VAT charged to the customer in sterling.

If there are several types of items on an invoice, then for each type of item, the invoice needs to show:

  • Quantity of goods or services sold
  • Unit price or rate for each unit
  • Rate of VAT being applied
  • Total amount payable excluding VAT.

If you issue an invoice that has zero-rate or exempt good or service on it, that that must be clearly shown and they need to be totalled separately.

If you do not issue a VAT invoice when asked to do so by a vat registered person/company, you may be liable to financial penalty even if the VAT rate is Zero or Exempt from VAT.

What is the issue about tax point?

The date of the invoice may not be the tax date of the supply. The tax point is the date that the sale is considered to be done. It may not be the physical supply of the goods/services. VAT reporting is done based on the time & date a supply is made.

Normally, for a supply to a non-vat registered person, the tax point date is the normally the date that the physical supply took place.

The date that the supply physically takes place for a sale of goods, it is the earlier of:

  • The supplier sends the goods to the customer;
  • The customer collects the goods from the supplier;
  • The goods are made available to the customer.

For services, it is based on the time that the service is carried out and completed, although may not be invoiced.

Of course, there are always exceptions !

  1. VAT invoice issued and a payment received but the goods or services have not actually been delivered (effectively a deposit invoice & payment), then the time of supply that needs to be taken into account for the VAT return is the date of the invoice or the date of the payment which ever is the earliest.
  2. A full payment received in advance and no invoice issued, then it needs to be accounted for on the date that the payment was received for VAT. Now, if part payment had been made and no invoice raised, the time of supply is the date of the part payment for the amount of the payment. The remaining payment will follow normal rules which may mean it is accounted for in a different VAT period.
  3. There is a 14 day rule – If you issue a VAT invoice more than 14 days after the supply was made, then the time of supply will be the date that the supply took place.

The exception to all this is if you are doing VAT returns on a cash accounting base.

Appendix – Times of Supply: When a VAT invoice is issued.

VAT can be very complex and failure to comply can incur financial penalties. For support, do get in touch.