What Information Must a VAT Invoice Contain?

January 11, 2021

An invoice is a document, in which the seller describes the details of a transaction. It also proves that the business transaction took place. Business customers use purchase invoices to reclaim taxes, as well. To standardize invoices and their content,  different governments have established specific rules on what an invoice should look like and which elements it should contain.

Invoices are valid only if they feature all elements prescribed by the government. If an invoice does not contain all required information, business customers cannot use it to reclaim any indirect taxes (VAT, GST, etc.).

What Are The Mandatory Elements Of A VAT Invoice?

In most countries, the elements that an invoice must contain are similar:

  • A reference to the word “Invoice” to clarify the purpose of the document, in the local language.
  • The seller's details:
  1. Name
  2. Address and location
  3. Tax identification number (TIN, VAT ID, GST ID...)
  • The customer’s details:
  1. Name
  2. Address and location
  3. Tax identification number (TIN, VAT ID, GST ID…)
  • The invoice details:
  1. Sequential invoice number
  2. Invoice date
  3. Date of delivery
  • A breakdown of the products or services:
  1. Description of goods or services supplied
  2. Quantity
  3. Price per unit
  4. Tax rate (GST/VAT/ST etc.),  if applicable
  5. Total amount excl. tax (net amount)
  6. Tax amount (if tax is applicable on the transaction at all)
  7. Total amount (gross amount)

Fonoa Invoicing automatically takes all local requirements into account when you create an invoice through the platform.

Some elements are not always mandatory

If a specific tax does not apply to a particular transaction, it’s not necessary to include information on the tax rate or amount (which would be 0). Otherwise, if a tax is applicable, the seller must include its details (rate, amount).

In business to consumer (B2C) sales transactions, suppliers often don’t have all customer details. As a result, the invoice is issued without these. However, it’s important to note that

  1. customers cannot use the invoice to reclaim any indirect taxes (VAT, GST, etc.) on the transaction,
  2. the invoice is generally not considered valid if it doesn’t have all customer details.

Need help with invoicing? Contact us, and we will help you simplify and automate invoicing.