It is vital to know about the necessary invoice requirements for UK invoices regardless of whether you are a freelancer, a sole-trader or a contractor. In order to comply with UK regulations concerning invoicing, it is important that you follow the specific guidelines that have come in effect since October 1, 2007. To begin with, it is crucial that all your invoices are 'sequentially' numbered. Secondly, if you are providing goods or services to other EU, non-VAT countries, then you need to include a statement within the invoice, explaining why you haven't charged VAT. The following details describe the generic details included within an invoice regardless of whether you are a freelancer or a sole trader:
- Your company's name, address and contact details.
- Your client's company name and address to whom you are invoicing.
- If you are registered for VAT, then you will have to provide your VAT registration number.
- A comprehensive description about the goods or services sold to your client.
- The supply date of the goods or services.
- The date on which the invoice is being issued.
- The amount of goods or services supplied to the client excluding VAT.
- Mention the VAT amount if it is applicable.
- The final amount due including VAT.
- The due date of the invoice for the purpose of payment.
Invoice requirements for different business structures vary accordingly and if you are a sole trader/partnership, you might want to refer to the following additional details necessary on your invoice.
- Mention any business name that doesn't use the surname of the sole trader of partners.
- If you are using a business name then you will have to include a business address where legal documents are usually received.
In case you are selling standard rated products to a non-VAT registered business in another EU country or a private individual in the EU, you will have to charge VAT. The invoice requirements for services are far more complex. Nevertheless, if your customer is a VAT registered company located in another EU country then you don't have to charge VAT, instead:
- Include your customer's VAT registration number along with your VAT number.
- Transport your products to your clients within three or six months if they require processing before delivery.
- Always keep valid commercial evidence that the products have exited the UK within the suggested deadline.
If you are a freelancer or a contractor, you will also have to include a breakdown of services along with the generic invoicing details mentioned above. The invoice should provide a clear overview of all the services you have offered to your clients. Separate columns should be designed, describing the nature of the work or service, quantity, date on which the service was supplied, rate charged, the number of hours worked and finally the subtotal. This way it makes it easy to tally the total if you have worked on multiple tasks or projects.
To make the invoicing process simpler, you might want to use a simple invoicing system that supports these requirements.