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Finance and Accounting, Tax and Accounting

Your Guide to Tax Invoice Requirements

By
Staff Writer

2023-03-08
Issuing invoices is an essential part of running a business, as this is how you get paid. However, you need to make sure your invoices include all of the right information for your business to stay tax-compliant. To do this, you need to understand the right tax invoice requirements and know when to use them. 

In this guide, we’ll cover everything you need to know about issuing tax invoices. This includes the exact tax invoice requirements you need to include to make sure your business stays compliant with all relevant tax laws. 

What Are Tax Invoices?

A tax invoice is a document that provides proof of the supply of goods or services between two parties. It's a legal document that is required by SARS for tax purposes. A tax invoice should be issued for every taxable supply made by a registered vendor.

With the Value Added Tax (VAT) system, businesses can deduct the VAT they incur on certain business expenses. VAT is collected based on the business’s output tax. If you don’t issue proper tax documents though, you can’t deduct the input tax that you incur from these business expenses. This means you need to have compliant tax invoices. 

Small business owners need to issue compliant tax invoices each time the invoice price exceeds R5000. 

Tax Invoice Requirements

SARS has a very clear set of requirements that need to appear on your tax invoice. When your business issues tax invoices, make sure it include the following information:
  • The name, address, and VAT registration number of the supplier (your business)
  • The name, address, and VAT registration number of the recipient (if the value of the supply is R5 000 or more)
  • The words "Invoice”, "Tax Invoice”, or "VAT Invoice”
  • Invoice number (must be unique and sequential)
  • Date of issue of the invoice
  • Description of the goods or services supplied
  • Quantity or volume of goods or services supplied
  • Price of the goods or services supplied (excluding VAT)
  • The amount of VAT charged
  • The total amount payable (including VAT)
If the invoice relates to a zero-rated supply, then the tax invoice will need to state that the supply is zero-rated and why this is the case. 

Abridged Tax Invoice Requirements

An abridged tax invoice can be issued when the value of the supply is less than R5000. Just like a regular tax invoice, an abridged tax invoice must include:
  • The name, address, and VAT registration number of the supplier
  • An invoice number
  • The date the invoice was issued
  • A description of the goods or services supplied
An abridged tax invoice does not need to include the name and address of the recipient or the price and quantity of the goods or services supplied. 

As a small business owner, it's important to understand the requirements for both full and abridged tax invoices to ensure that you comply with all relevant tax laws.

Tips for Maintaining Accurate Tax Invoices

Small business bookkeeping can be a tricky process. However, with the right systems in place, maintaining the correct procedures doesn't have to result in a headache. 

Here are some tips to ensure you meet the right tax invoice requirements each time.
  1. Keep accurate records of all your sales and purchases. This will help you to complete your tax returns more accurately and efficiently.
  2. Issue tax invoices on time: Set a dedicated period for issuing invoices, and ensure they include all the required information.
  3. Use a unique numbering system for your invoices. This will make it easier to track your invoices and ensure that none are missed. Of course, this needs to be sequential.
  4. Use accounting software. Many easy accounting solutions exist for mall business owners, making invoicing and tax compliance a lot easier.
  5. Check the VAT registration number of your customers: This ensures they are registered for VAT. If they are not registered, you don't need to include their VAT registration number on the invoice.
Most importantly, if you're not sure whether a supply is taxable or not, seek advice from a tax professional. This is always the best solution for any small business navigating the world of tax and accounting.

Following the right tax invoice requirements is an essential part of running a business. Once you’ve created a template for this, you can simply reuse it for each invoice you send out. 


Making sure your business remains tax-compliant is essential, and this is something you’ll want to do from day one. Working with an experienced business tax consultant can make this journey a lot easier.