Tax invoice requirements in Australia: what the ATO says to include

Once you're registered for GST, your invoices do a second job. Your business customers need a tax invoice to claim back the GST you charged them as a GST credit. The ATO doesn't prescribe a layout, but the GST Act and the ATO's ruling on tax invoices (GSTR 2013/1) set out what the document must show. The test is simple: each detail must be clear from the invoice itself.

This guide covers the seven details every tax invoice needs, the extra detail from $1,000, invoices that mix taxable and GST-free items, rounding, and when you have to issue one. The free invoice generator always prints the fuller $1,000 tier, so your tax invoice is valid at any amount.

What a tax invoice must show

On top of this list, most businesses add an invoice number, both addresses, a due date and payment details. There's no prescribed numbering format, but a unique, sequential number (INV-0001, INV-0002) keeps your records easy to follow.

The title and your identity

The simplest way to show the document is a tax invoice is the heading "Tax Invoice". The ATO also accepts "GST Invoice", or a statement in the body.

Your identity can be your legal name or your registered business name. A sole trader often shows both, and Invoice Native prints "Jane Citizen trading as Jane's Gardens". A licence number on its own, such as a builder's licence, doesn't identify you. A trust shows its name or registered business name with the trust's ABN. For more on the number itself, see your ABN on invoices.

Descriptions and the extent each sale is taxable

Each line needs a brief description that a person can understand. A part number or product code on its own is not a description. A price per line or per category of item is enough.

The invoice must also show the extent each sale is taxable. GSTR 2013/1 accepts any of these:

• the GST amount on each taxable line;
• a statement of how far each item is taxable;
• a mark, such as # or *, on the taxable lines, with a note explaining it.

Invoice Native has a GST column on every line that shows "10%", "GST-free" or "Input taxed", so the status of each sale is always clear.

Mixed invoices

When one invoice has taxable items alongside GST-free or input-taxed items, the ATO says it must clearly show:

• which items are taxable;
• each taxable sale;
• the GST payable;
• the total payable.

The ATO's own example marks taxable lines with # and shows a "Total GST" figure. A GST column that reads "GST-free" on the other lines does the same job. When lines are mixed, Invoice Native also adds a GST summary under the lines, with the taxable value and GST, and the GST-free and input-taxed values listed separately. See GST-free sales for what counts as GST-free.

Worked example

A GST-registered web designer bills a business client:

Because the sale is over $1,000, the invoice also needs the client's name or ABN. GST is 10% of the GST-exclusive price. If your prices include GST, the GST is one-eleventh of the total: $110.00 includes $10.00 GST.

Rounding GST

The ATO's rules on rounding:

• One taxable sale on the invoice: round the GST to the nearest cent, with half a cent rounding up.
• Several taxable sales: either total the GST for the invoice and round once (the total invoice rule), or work out GST per line and round the total to the nearest cent (the taxable supply rule).

You and your customer don't have to use the same rule. Invoice Native uses the total invoice rule: it works out GST on the total of the taxable lines and rounds it once, half a cent up.

When you must give a tax invoice

Under the GST Act, a registered business must give a tax invoice within 28 days of the buyer asking for one. Sales of $82.50 or less including GST ($75 excluding GST) are exempt from that rule. Not issuing one when asked can attract a penalty. business.gov.au describes it as giving a tax invoice for any taxable sale over $82.50, or when asked. Either way, issuing a tax invoice for every sale is the safe default, and it's what most businesses do.

A tax invoice can be electronic. A PDF sent by email is fine.

If you need to correct a tax invoice after you've sent it, you usually issue an adjustment note rather than a new invoice.

Checklist

• ✅ Title "Tax Invoice"
• ✅ Your legal name or registered business name, and your ABN
• ✅ The date of issue and a unique invoice number
• ✅ A clear description, quantity and price on each line
• ✅ The GST amount, and the GST status of each line
• ✅ The buyer's name or ABN on sales of $1,000 or more
• ✅ Issued within 28 days of a request; records kept for 5 years

Rules can change, so check the ATO's guidance or ask a registered tax agent about your situation. Invoice Native does not provide tax advice.