Show download pdf controls
  • Issuing tax invoices

    When you make a taxable sale of more than $82.50 (including GST), your GST-registered customers need a tax invoice from you to be able to claim a credit for the GST in the purchase price.

    If a customer asks you for a tax invoice, you must provide one within 28 days of their request.

    Tax invoices must include at least seven pieces of information. There are additional requirements for invoices for:

    Requirements of tax invoices

    Tax invoices for taxable sales of less than $1,000 must include enough information to clearly determine the following seven details:

    1. that the document is intended to be a tax invoice
    2. the seller's identity
    3. the seller's Australian business number (ABN)
    4. the date the invoice was issued
    5. a brief description of the items sold, including the quantity (if applicable) and the price
    6. the GST amount (if any) payable – this can be shown separately or, if the GST amount is exactly one-eleventh of the total price, as a statement such as 'Total price includes GST'
    7. the extent to which each sale on the invoice is a taxable sale (that is, the extent to which each sale includes GST)
      1. Example 1 meets this requirement because the sale is clearly identified as being fully taxable by the words 'total price including GST'
      2. Example 2 meets this requirement in two ways: it shows the GST included in each line item (see column with the GST amount), and the sale is clearly identified as being fully taxable by the words 'the total price includes GST'.

    In addition, tax invoices for sales of $1,000 or more need to show:

    1. the buyer's identity or ABN

    If your tax invoices meet the requirements for sales of $1,000 or more, you can also use them for sales of lesser amounts.

    Example 1: Tax invoice for a sale under $1,000

     Example 1: Tax invoice for a sale under $1,000. This meets the requirement because it shows: 
- Tax invoice (heading)
- Windows to Fit Pty Ltd (seller's identity)
- ABN 32 123 456 789
- Building Company 15 Burshag Rd Festler NSW 2755 
- Date: 1 August 2010
- Description of supply - window frames $825 
- Total price including GST $825

    Example 2: Tax invoice for a sale of more than $1,000

     Example 2: Tax invoice for a sale of more than $1,000. This meets the requirement because it shows: 
- Tax invoice (heading)
- Windows to Fit Pty Ltd (seller's identity)
- ABN 32 123 456 789
- Building Company 15 Burshag Rd Festler NSW 2755 
- Date: 1 August 2013
- Description of supply -
 50 window frames unit price $150 GST $15 Total $8,250
10 deadlocks unit price $40 GST $4 Total $440
- Total amount payable $8,690
- The total price includes GST

    End of example

    If you supply or receive an invoice which only has a figure at a wine equalisation tax-goods services tax (WEG) label, you will need to obtain further information to be able to claim GST credits and for it to be considered a valid tax invoice.

    See also:

    Taxable and non-taxable sales

    A tax invoice that includes taxable and non-taxable items – that is, items that are either GST-free or input-taxed – must clearly show which items are taxable. In addition to the standard information the tax invoice must also show:

    • each taxable sale
    • the amount of GST to be paid
    • the total amount to be paid.

    See also:

    e-Invoicing

    e-Invoicing is the exchange of invoice related documents between a seller and a customer in an electronic format.

    A tax invoice does not need to be issued in paper form. You can issue a tax invoice to a customer by means of e-Invoice. This is not limited to, for example, issuing a tax invoice in a PDF format. What is important is that the electronic record transmitted to the customer contains all of the information required for a tax invoice and is readily accessible and easily convertible to English.

    Rounding of GST

    Where an amount of GST includes a fraction of a cent, special rounding rules apply.

    Where there is only one taxable sale on a tax invoice, the amount of GST should be rounded to the nearest cent (rounding 0.5 cents upwards).

    Where there is more than one taxable sale on a tax invoice, there are two rules known as the 'total invoice rule' and the 'taxable supply rule':

    • Total invoice rule – under this rule, the unrounded amounts of GST for each taxable sale should be totalled and then rounded to the nearest cent (rounding 0.5 cents upwards).

    Alternatively, if all the taxable sales on a tax invoice include an amount of GST that is exactly 1/11 of the price, you may choose to add up the GST-exclusive value of each taxable sale, calculate GST on that amount and then round to the nearest cent (rounding 0.5 cents upwards).

    • Taxable supply rule – under this rule, you need to work out the amount of GST for each individual taxable sale. Where the unrounded amount of GST has more decimal places than your accounting system can record, the amount should be rounded up or down as appropriate. You then need to add the individual amounts and round this total to the nearest cent (rounding 0.5 cents upwards).

    You and your customer do not need to use the same rounding rules.

    Agency relationships

    Special rules apply to tax invoices for transactions carried out through agents.

    See also:

    • GSTR 2000/37 Goods and services tax: agency relationships and the application of the law

    Recipient-created tax invoices

    In most cases, tax invoices are issued by the supplier. However, in special cases, you, as the purchaser or recipient of the goods or services, may issue a tax invoice for your purchases. This is known as a recipient-created tax invoice (RCTI).

    When you can issue an RCTI

    You can issue an RCTI if:

    • you and the supplier are both registered for GST
    • you and the supplier agree in writing that you may issue an RCTI and they will not issue a tax invoice
    • the agreement is current and effective when you issue the RCTI
    • the goods or services being sold under the agreement are of the type that we have determined can be invoiced using an RCTI.

    Your written agreement can either be a separate document in which you specify the supplies, or you can embed this information or specific terms in the tax invoice itself.

    See also:

    When an RCTI is valid

    To be valid, an RCTI must contain sufficient information to clearly determine the standard requirements (except that it needs to show the document is intended to be a recipient-created tax invoice, not a standard tax invoice).

    In addition it must detail the purchaser's identity or ABN.

    It must also show that, if GST is payable, it is payable by the supplier.

    As the recipient, you must:

    • issue the original or a copy of your RCTI to the supplier within 28 days of one of the following dates
      • the date of the sale
      • the date the value of the sale is determined
    • retain the original or a copy of the RCTI
    • reasonably comply with your obligations under the tax laws.

    You must not issue a document that would otherwise be a RCTI on or after you or the supplier have failed to comply with any of the requirements of RCTIs.

    See also:

    Last modified: 23 Nov 2017QC 22438