Tax invoice requirements in South Africa: what must be on a valid tax invoice
The legal requirements for a tax invoice in South Africa. A SARS checklist for full and abridged tax invoices, what an ordinary invoice needs, and the mistakes that get input tax claims rejected.
An invoice that looks professional is not automatically a valid tax invoice. SARS sets out specific details that must appear on it, and if one is missing your customer can lose their input tax claim. That usually comes back to you as a request to reissue the invoice, and a payment that waits until you do.
Here is what the rules require, in plain language: what a tax invoice is, the legal requirements for an invoice in South Africa, and a checklist you can work through before you send one.
What is a tax invoice?
A tax invoice is an invoice issued by a VAT-registered business that shows the VAT charged on a sale. It is the document your customer needs to claim that VAT back as input tax. An ordinary invoice asks for payment. A tax invoice does that and also meets SARS's VAT requirements.
First: who can issue a tax invoice
Only registered VAT vendors may issue tax invoices and charge VAT. If you are not registered for VAT, you send an ordinary invoice with no VAT on it and no VAT number. Calling it a tax invoice or adding 15% is not allowed.
If you are a VAT vendor, you must issue a tax invoice within 21 days of making the supply.
The three value bands
What you need to issue depends on the total value of the sale, including VAT:
| Value of the supply | What is required |
|---|---|
| R50 or less | No tax invoice required |
| More than R50, up to R5,000 | An abridged tax invoice is enough |
| More than R5,000 | A full tax invoice |
Checklist for a full tax invoice
For supplies above R5,000, the invoice must show:
- The words "Tax Invoice", "VAT Invoice", or "Invoice".
- Your business name, address, and VAT registration number.
- Your customer's name and address, and their VAT registration number if they are a VAT vendor.
- A unique serial number and the date of issue.
- An accurate description of the goods or services supplied.
- The quantity or volume supplied.
- The value of the supply, the VAT charged, and the total including VAT.
What an abridged tax invoice can leave out
For supplies of R5,000 or less, the abridged version needs your details, the serial number and date, a description of what was supplied, and the amounts. It does not need the customer's name, address, or VAT number, or the quantity.
In practice, many businesses issue full tax invoices for everything. It costs nothing extra if your invoicing tool fills the fields in for you, and it means you never have to think about which band a sale falls into.
Legal requirements for an ordinary invoice
If you are not VAT registered, there is no SARS checklist for your invoices, but a clear invoice still protects you and gets you paid. Include:
- Your business name and contact details.
- Your customer's name.
- A unique invoice number and the date.
- A description of what you supplied, with quantities and prices.
- The total amount due, the due date, and how to pay you.
Do not add VAT, a VAT number or the words "Tax Invoice". Our guide to choosing an invoice template covers what makes any invoice clear and professional.
Mistakes that cause problems
These are the ones that most often lead to a rejected claim or a reissued invoice:
- Missing customer VAT number. On a full tax invoice to another vendor this is required, and it is the detail most often left off.
- Trading name instead of registered name. Use the name your business and your customer are registered under.
- Duplicate or missing invoice numbers. Numbers must be unique and should run in sequence. Gaps and repeats raise questions in a SARS review.
- Vague descriptions. "Services rendered" tells nobody what was supplied. Say what the work was.
- VAT not shown separately. Show the amount excluding VAT, the VAT, and the total.
- A quote or pro forma used as the invoice. A quote or pro forma is not a tax invoice, and your customer cannot claim input tax from one.
Corrections: do not edit, issue a credit note
If an invoice goes out with the wrong amount, do not change it and send it again under the same number. Issue a credit note against the original and then a new, correct invoice. That keeps a clean trail that matches what both you and your customer declare.
Keep your records
VAT vendors must keep tax invoices, credit notes, and supporting records for at least five years. Digital copies are acceptable as long as you can produce them when asked, so a folder of emailed PDFs that nobody can find does not really count.
Frequently asked questions
What is a tax invoice in South Africa?
A tax invoice is an invoice issued by a registered VAT vendor that shows the VAT charged on a supply. Your customer needs it to claim the VAT back as input tax.
What are the legal requirements for a tax invoice?
For supplies over R5,000, a full tax invoice must show the words "Tax Invoice", "VAT Invoice" or "Invoice", your name, address and VAT number, your customer's name and address (and VAT number if they are a vendor), a unique serial number and date, a description, the quantity, and the value, VAT and total. For R5,000 or less, an abridged tax invoice is enough.
Can I issue a tax invoice if I am not VAT registered?
No. Only registered VAT vendors may issue tax invoices and charge VAT. If you are not registered, send an ordinary invoice with no VAT on it.
How soon must I issue a tax invoice?
A VAT vendor must issue a tax invoice within 21 days of making the supply.
Is a quote or pro forma invoice a tax invoice?
No. A quote or pro forma invoice is not a tax invoice, and your customer cannot claim input tax from one. Issue the tax invoice once the supply is made.
How long must I keep tax invoices?
VAT vendors must keep tax invoices, credit notes and supporting records for at least five years. Digital copies are fine if you can produce them when asked.
Get it right by default
The easiest way to meet every requirement is to stop relying on memory. Eazy-Biz invoice templates carry your business details, number each invoice, calculate VAT, and export a PDF you can send straight to your client. Start a free trial and create your first invoice in a few minutes.
Not yet sure whether you should be charging VAT at all? Read our guide to the VAT registration threshold.
This article is general information for South African business owners and is not tax, legal, or financial advice. Rules and thresholds change, so confirm your position with SARS or a registered tax practitioner before acting on it.