A tax invoice or a goods and services tax (GST) invoice is a type of invoice given to a buyer from a registered seller, which shows the transaction’s taxable amount. A typical tax invoice usually contains a detailed description, value, quantity, and tax rate for purchased items.
After a taxable purchase, a business owner would want to send a tax invoice to the clients that request an invoice if they require to claim a tax credit or for other reasons. Primarily, tax invoices are issued when items are purchased for resale.
Tax invoices that are issued from one business to another are usually used to report tax information to the appropriate authority periodically as required.
Tax Invoice Fields
A valid tax invoice would usually have some critical information, which is written within several fields. These fields are highlighted and discussed below.
- Tax Invoice Subject
- Company Information
- Tax Invoice Date
- Client Information
- Itemized Items
- Total Due Amount
- Comments and Remarks
- Terms and Conditions
Tax Invoice Subject
The tax invoice subject field is usually written within the header field, which provides an identifier for anyone who gets hold of the invoice.
The company information would usually be written within the header field below the invoice heading. The company information may include a logo, name, address, and contact details. You may also find the contacts person’s contact details written within the body of the tax invoice. Also, the company would include their tax identification number.
Tax Invoice Date
A valid GST invoice would have a date field for validation.
The client information would be written within the bill-to field. This information includes the name and contact details. Also, the client’s address would be provided. If the shipping and billing addresses are different, each address would have a field.
Itemized items would usually be input in a tabular field. Each item would have a corresponding code, description, quantity, and unit price.
Total Due Amount
The total due amount field provides the total cost of the transaction. This value is determined by adding taxes, handling fees, and other charges.
Comments and Remarks
The comments and remarks field allows the supplier to input additional input information for the clients within the tax invoice.
Terms and Conditions
This field allows the supplier to stipulate all the terms and conditions that govern the business transaction between the supplier and its clients.
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How to Create a Tax Invoice
If you happen to be a supplier and your clients require a tax invoice for some need, you would want to know how to generate a GST invoice. You can quickly develop a tax invoice using a specialized or a generic software application. Generic applications such as word processing software and spreadsheet software can easily be used. The best way to go about creating a GST invoice is by developing a custom invoice template, which allows you to create an invoice when required quickly. You can easily generate a tax invoice following these steps.
- Develop an Invoice Using a Software
- Provide a Title for the Invoice and Invoice Number
- Add Your Company and Buyer Information
- Describe all Goods and Services Sold or Supplied
- Include all Relevant Dates
- Highlight Additional Fees, Deductions, Taxes, Advances, and Others
- State Payment Method, Terms, and Personal Message
You can find more details on creating an invoice on how to create an invoice article.
Here’s the list of main invoice fields:
- Company information
- A unique identifier, date, and invoice number
- List of items and services
- Terms of sales
- List of fees
- Total due amount
Useful resources about invoices:
- How to Create an Invoice
- Tips to Customize your Invoice Templates
- Differences Between Bill and Invoice
- How to Create Invoice With/Without Logo
- How to Create Invoice With/Without Discount
- How to Create Invoice With/Without Tags
- Bill-Only Requisitions
- Payment Requisitions
- Purchase Orders
- PR vs PO
- Tax Invoice
- Chargeback Invoice