In making business transactions, we all need an invoice to claim the VAT we paid for. A VAT invoice includes all the details of the purchases made and services provided. VAT is a very useful component for the companies as the taxes can be recovered from such companies. Businesses exceeding a certain limit of revenue have to register for VAT. Not doing so can result in non-compliance to the government.
Businesses voluntarily register for VAT even when they do not have to. It will get them a benefit of not crossing the threshold any time and avoid any penalties and fines. Starting a new business can be challenging but businesses who register for VAT get an edge from ordinary small businesses. But registering for VAT can help the business get external finances from venture capitalist as well as banks.
Not only is getting finance easier for VAT registered companies, some vendors and customers do not like doing business with companies which are not VAT registered. So by registering for VAT, the business will hold a specific VAT number which makes it easy to do business with third parties.
VAT is also very helpful when making purchases globally. The amount spent can be recovered using the VAT number. Tax-free purchases or the purchases on which tax can be recovered always bring a lot of comfort for the buyers.
VAT stands for value added tax and the invoice mentions the details about how much tax is to be applied for a particular item or the service rendered. The VAT invoice is a document that notifies an obligation to make a payment. A registrant or registered taxpayer means a taxable person who is registered for VAT and is required to charge VAT and file VAT returns on time. A few requirements are to be fulfilled for making a good and considerable VAT invoice. The requirements are mentioned below.
The invoice must open with the name and logo of the company along with the contact details like address, contact number, and VAT number that the company has. Numeric-like date on which the invoice is issued and the invoice number must be correctly placed where it can be seen properly. Name of the person company interested in VAT invoice must be written on the top under the company details, in block letters for better illegibility. The name must be followed by contact details like address, phone number, city and ZIP code etc.
A few columns must be drawn out to give a detailed view of what product or service the VAT is applied on, along with the product ID. Another column must be specified to apply the VAT rate and the VAT amount must be mentioned separately for each item. Then at the end the amount totaled to be paid must be written properly where it can be seen and read without any confusion.
A VAT invoice includes:
- Company name
- Contact details of the company
- Customer details
- Description of the purchase/services
- Unit price and quantity of purchased item
- VAT rate applicable
- VAT registration number
- Terms & conditions of payment
- Mode of payment
VAT Invoice Template
For: EXCEL(.xls) 2003 & later [Android+iOS] & iPad
Download File Size: 40 kb
For: OpenOffice Calc [.ods] | Download File Size: 19 kb
[Personal Use Only]