What every invoice must show
- VAT invoices must show the VAT number, the rate per line, the VAT amount and the tax point (time of supply).
- Simplified invoices are allowed for sales of £250 or less.
Numbering, keeping and correcting invoices
Under Schedule 11, paragraph 6 of the Value Added Tax Act 1994, HMRC can require VAT records, including copies of invoices issued and received, to be preserved for up to six years. Till rolls and product code lists for retail sales are likewise kept for six years unless HMRC agrees a shorter period.
Foreign currency amounts must be converted into sterling using the UK market selling rate at the time of supply or an approved HMRC method (Notice 700, paragraph 7.6).
A valid VAT credit note must correct a genuine mistake, overcharge or agreed reduction and be issued within 14 days of the refund payment. It must carry its own number and date, the original invoice number and date, and the VAT credited in sterling.
A debit note for an undercharge must be issued within 14 days of the increase being agreed. A credit note without a VAT adjustment should say: This is not a credit note for VAT.
Electronic invoicing in the United Kingdom
No mandatory B2B e-invoicing yet; HMRC has consulted on it. PDFs are fine, but VAT records must be kept digitally under Making Tax Digital.