If you're registered for VAT, a tax invoice is more than a request for payment: it's the document your customer needs to claim back the VAT you charged. SARS's VAT 404 Guide for Vendors sets out what one must contain, and an invoice that leaves something out can cost your customer their input tax.
When you must issue one
A VAT vendor must issue a tax invoice within 21 days of making a supply, whether the customer asks for one or not, when the price is more than R50. For R50 or less, no tax invoice is needed, but a till slip showing the VAT is still required for your records.
Full or abridged
The type depends on the total, including VAT:
- More than R5,000: a full tax invoice.
- R5,000 or less: an abridged tax invoice is enough, except for zero-rated supplies such as exports, which always need a full one.
What a full tax invoice shows
- The words "tax invoice", "VAT invoice" or "invoice".
- Your name, address and VAT registration number.
- Your customer's name, address and, if they're a vendor, their VAT number.
- A serial number and the date of issue.
- A full and proper description of the goods or services.
- The quantity or volume supplied.
- The price and the VAT, shown in one of SARS's three ways: every amount separately; the total with the VAT rate stated; or the total with the VAT amount stated.
An abridged tax invoice shows the same, except that the customer's details and the quantity aren't needed.
Rand only, mostly
A tax invoice must be in South African currency, except for zero-rated supplies (such as goods exported) and certain electronic services supplied by non-residents. If you invoice an overseas customer for an export, you can invoice in their currency; for a local customer, the tax invoice must be in rand.
If you're not registered for VAT
You can't issue a tax invoice and mustn't call your invoice one. An ordinary invoice can show anything you and your customer agree, in any currency, but no VAT.
A worked example
You do R10,000 of consulting for a company, excluding VAT. VAT at 15% is R1,500, so the total is R11,500. That's more than R5,000, so you need a full tax invoice, with the company's name, address and VAT number. Our invoice generator works this out as you type and lists anything still missing.
Sources
This is general information, not tax, legal or financial advice.