What Information Should a Tax Invoice Show?

What Information Should a Tax Invoice Show?


What Is a Tax Invoice?

A tax invoice is an account that usually appears in the current liabilities section of the balance sheet for the business. The tax invoice is the generally accepted format of invoice required under the GST system. Unlike a non-trade invoice which that shows the amounts of the receivable that is due for a payment to an organization. The tax invoice shows the GST or the Goods and Tax Service invoice on the goods and services provided.

In addition to that, all companies must issue a tax invoice to their customer or client, failure to do so will result in paying penalties.

The Importance of Tax Invoice

As mentioned above, all companies must issue a tax invoice form to their customer or client and must have a valid tax invoice. There is a reason for that. When the company has a valid tax invoice coming from the supplier, they can claim back all the GST they have paid when they made the purchase for their business.

The tax invoice can also be used as an evidence to support an Input Tax Credit claim. However, the registered companies can not use the name of Proforma invoice, Temporary Invoice or Sale Invoice in one of their invoices.

What Information Should a Tax Invoice Show?

Below is the common information that appears on every tax invoice. Take note that not all tax invoice includes of this information.

  • The word “Tax Invoice” this usually found at the top of the invoice
  • blank Invoice serial number
  • Date of which the invoice was issued
  • The name, address & GST Registration Number of the Registered Company
  • The name & address of the customer
  • Service or product details and quantity
  • The discount rate (if applicable)
  • Total sale amount before GST
  • Rate of tax (the common is 6%)
  • Total GST charged
  • Total sale amount including GST

When to Issue a Tax Invoice?

The time period of when to issue a tax will all depend on the country where the transaction takes place. They have different laws regarding of the issuance of tax invoice and that it should be followed. However, there are certain countries that follow the same law on when to issue a tax.

According to their laws, the professional invoice for tax must be issued within 21 days from the time of the supply. This means the date of the goods that are delivered or the service that is rendered. Also stated that the tax invoice is not required for Zero-Rated Supply and should not be issued for second-hand items or products and service that is imported outside the country.

The Requirements for Tax Invoice

A tax invoice examples in excel would not be valid without these pieces of information.

  • Supplier’s name and address
  • Customer’s name and address.
  • VAT identification number
  • Invoice number
  • Invoice date and the date the goods and services supplied.
  • The quantity and the type of good and/or service provided.
  • Service invoice
  • Price per unit
  • The cost
  • The date of advance payment
  • VAT tariff that is included in the tax invoice
  • The amount of VAT