Month: September 2013

VAT invoices – the fine details

All businesses need standardised documents for their correspondence and invoices. An invoice is basically a standard letterhead with the addition of a number of billing points. The examples set out here assume that your business is a limited company.

VAT invoices must show:

  1. Your address and the address of your company registered office. If your company registered office and your principal place of business are one and the same, you only need to show the address once, provided that it is clear that they are one and the same!
  2. Your company registration number.
  3. Your VAT registration number.
  4. The date of the invoice.
  5. The invoice number. Invoices must be sequentially numbered, using a plain and simple, and purely numeric system. Do not skip numbers. Invoices must run in number order and also in date order. Do not use a number on draft invoices if that results in the sequence becoming broken. Draft invoices should only be given a number when they are finalised and issued.
  6. The name and address of the person being invoiced. This is the name of your client and not necessarily the name of the individual who works there. You can for example mark the invoice “F.A.O. Mr Jones”, but it should be addressed to the client, for example “London Time Machines Ltd”.
  7. The amounts in GB Pounds. If you wish, you can show a different currency within the dialogue within the invoice, but not where it’s likely to confuse a VAT officer. In the event of a records inspection, the VAT officer must be able to clearly see the GBP figures, and especially the ones at the foot of the invoice.
  8. A sub total line, showing the net figure excluding the VAT.
  9. A VAT line, showing the applicable rate and the VAT amount in isolation.
  10. A total line, showing the sum of the net amount and the VAT.

Example Letterhead
Example Invoice (non-VAT)
Example Invoice (VAT)

Once an invoice has been issued to a client, it should never be amended. If there is anything wrong with an invoice the correction must be done in the way we have set out here https://www.proactive.ly/news/?p=353