VAT invoice
VAT invoice example for a UK business
A UK VAT invoice has to carry the details HMRC lists for a full VAT invoice, including the VAT registration number, the tax point and the VAT rate on each line, so the customer can reclaim the VAT. This example from a Bristol design studio to a coffee roaster bills packaging design at £3,300 plus VAT at 20%, with 30 day terms and the statutory late payment interest stated.
The invoice, page by page
The invoice as the client downloads and prints it.
The pricing, line by line
- Packaging design, coffee bags
- 4 × £650.00
- Bean illustration
- 1 × £480.00
- Print management
- 1 × £220.00
- Tax
- £660.00
- Total
- £3,960.00
Section by section
- Header
- The studio's name, full Bristol address, phone, website and accounts email, with invoice number HH-1042.
- Bill to and dates
- The roaster's name and address, the 13 October invoice date and the 30 day due date.
- Title
- VAT invoice, the VAT registration number and the tax point.
- Lines
- Four bag designs, an illustration and print management, each with quantity, unit price and VAT at 20%.
- Totals
- The total before VAT, the VAT, the total in pounds and the amount due.
- Notes and bank details
- The tax point and why it differs, the payment terms, statutory interest, then sort code, account and reference.
What makes a full VAT invoice in the UK
HMRC's VAT guide lists what a full VAT invoice must show: a unique sequential number, the time of supply and the issue date if different, the supplier's name, address and VAT registration number, the customer's name and address, a description that identifies the goods or services, and for each item the quantity, the VAT rate and the amount before VAT, then the total before VAT and the total VAT in sterling. A simplified invoice is allowed only for supplies of £250 or less when the customer agrees. This invoice is £3,960 with VAT, so it is a full invoice. The VAT registration number and the tax point are in the title, because the business block at the top prints the name, address and contact details.
How the VAT is worked out
Four packaging designs at £650 are £2,600, the illustration is £480 and print management £220: £3,300 before VAT. VAT at the standard rate of 20% is £660, and the total is £3,960. VAT is worked out per line and added together. All three lines are standard rated; if an invoice mixes rates, the per line VAT column shows which rate applies to each, as HMRC requires. The invoice is dated 13 October, four days after the tax point, which is within the 30 days HMRC normally allows for issuing a VAT invoice after the tax point.
How this differs from an Australian tax invoice
The idea is the same, an invoice that lets a registered buyer reclaim the tax, but the details differ. The UK invoice shows a VAT registration number rather than an ABN, VAT at 20% rather than GST at 10%, a tax point, and amounts in sterling. UK businesses must register for VAT once taxable turnover passes the registration threshold, and the late payment rules are set by statute: if no date is agreed, payment between businesses is late 30 days after the invoice or delivery, and statutory interest applies unless the contract sets a different rate. The Australian version of this page uses the same layout with GST free and taxable lines.
What makes this invoice work
The HMRC fields are all there
Invoice number, the supplier's name, address and VAT registration number, the customer's name and address, the tax point, a description, quantity, unit price, VAT rate per line, the total before VAT and the VAT in sterling. Those are the items HMRC lists for a full VAT invoice.
The tax point is explained
The tax point, 9 October when the final artwork was delivered, differs from the 13 October invoice date, so both are shown and the notes say why. The customer accounts for the VAT in the right period, and HMRC expects a VAT invoice within 30 days of the tax point.
Late payment has a legal basis
The notes give 30 day terms and say statutory interest may be claimed under the Late Payment of Commercial Debts (Interest) Act 1998 at 8% above the Bank of England base rate. A UK business does not need a late fee clause of its own to rely on that.
Questions people ask
What must a UK VAT invoice include?
A unique number, the tax point and the issue date if different, your name, address and VAT number, the customer's name and address, a description, the quantity, unit price and VAT rate for each item, the total before VAT and the VAT in sterling. This example shows each of them.
What is the tax point on a VAT invoice?
The time of supply, which decides the VAT period the VAT belongs to. For services it is usually when the work is completed or paid for. This invoice shows a tax point of 9 October, when the artwork was delivered, and an invoice date of 13 October.
When can I use a simplified VAT invoice?
Only when the supply is worth £250 or less including VAT and the customer agrees. A simplified invoice shows less detail, such as the total including VAT for each rate. This invoice is £3,960, so it must be a full VAT invoice.
Can I charge interest on a late invoice in the UK?
Between businesses, yes. Unless the contract sets a different rate, statutory interest under the Late Payment of Commercial Debts (Interest) Act 1998 is 8% a year above the Bank of England base rate, and you may also claim fixed debt recovery costs. This invoice states the interest in its notes.
How soon must a VAT invoice be issued?
HMRC says you should normally issue a VAT invoice within 30 days of the tax point. This invoice is issued four days after it. Sending the invoice when the work is delivered avoids the question and gets the 30 day payment terms started sooner.
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