What must a UK business invoice include?
Under UK VAT regulations and general commercial best practice, a standard business invoice should include a minimum set of information to be legally valid and usable for accounting and credit control purposes.
- A unique, sequential invoice number
- Your business name and registered address
- Your VAT registration number (if VAT registered)
- The invoice date and the supply date (if different)
- Your customer's name and address
- A clear description of the goods or services supplied
- The quantity and unit price
- The net amount before VAT
- The VAT rate applied (standard 20%, reduced 5%, or zero-rated)
- The VAT amount
- The gross total payable
- Payment terms and due date
- Your bank account details (sort code and account number)
VAT invoice requirements
If you are VAT registered, your invoices must comply with HMRC's VAT invoice requirements. A full VAT invoice is required for most B2B transactions over £250. For transactions below £250 to VAT-registered customers, a simplified VAT invoice is permissible.
A VAT invoice is the only document that allows your customer to reclaim VAT as input tax. Issuing an invoice without a VAT number when you are registered, or claiming to be VAT registered when you are not, are both serious offences.
Common invoicing mistakes
Small errors on invoices cause a disproportionate amount of late payment. Accounts payable teams at large companies will often delay payment pending correction of errors, so getting it right first time is important.
- Missing or incorrect VAT number
- Invoice date and supply date not matching the terms agreed
- Bank details missing or incorrect
- Inconsistent description of services compared to the purchase order
- Missing purchase order reference number (required by many large buyers)
- Incorrect VAT rate applied
Frequently Asked Questions
Do I need to issue an invoice for every sale?
For VAT-registered businesses, you must issue a VAT invoice for any taxable supply to another VAT-registered business within 30 days of the supply. For non-VAT-registered businesses, there is no legal obligation to issue an invoice, though it is best practice.
Can I issue invoices by email?
Yes. Electronic invoices are legally valid in the UK provided they contain all required information. You should retain a copy of all invoices and proof of delivery for your records.
What is a pro forma invoice?
A pro forma invoice is a preliminary invoice issued before goods or services are supplied, often used to request payment in advance. It is not a VAT invoice and cannot be used for VAT reclaim purposes.