What You Should Include on a Tax Invoice

Issuing an invoice to a customer for goods or services rendered is a basic element of doing business. The building & construction industry is no different.

There is a distinction between an “Regular Invoice” and a “Tax Invoice”.

Where you are not registered for GST, the correct term is “Invoice”
Where you are registered for GST, the correct term is “Tax Invoice”

What to Include on a Tax Invoice:

A line stating “Tax Invoice”
The Seller’s Identity
The Seller’s ABN
The date the invoice was issued
Quantity, description and price of items sold
The GST amount (unless items are GST free)
Which sales include GST, and which are GST free
If the sale is above $1,000, the identity details of the customer need to be included as well.

For sales above $82.50 incl GST, GST registered customers need to have a tax invoice to be able to claim credit on the purchase GST. An invoice needs to be provided within 28 days of a customer request. The invoice must be in English.

Even if you are not registered for GST, a customer can still ask for a Tax Invoice. In this case, you need to include the statement “Price does not include GST”, or show the GST component of the invoice is 0.

A Tax Invoice does not need to be in paper form and can be sent to your customers electronically in PDF format.

What happens if a Tax Invoice is Incorrect?

If you have issued a Tax Invoice, and any of the above details are not included in the invoice, the invoice is invalid. You will need to issue the customer a new tax invoice with the correct information.

Tips For Your Tax Invoices;

Have progressive invoice numbers.
This is essential for organisation and communication, especially if a customer does not pay a bill on time, or there is an issue with the invoice.
Include payment terms, or a payment due date.
This will let your customers know when they need to pay by, improving your cash flow and reducing time spent chasing bills.
Send your tax invoices promptly.
Your customers are more likely to pay your bill the closer it is to the goods being purchased, or services rendered.