What is a Tax Invoice?

If you are a VAT registrant then a Tax Invoice is a very important document for you and you should know how to make a Tax Invoice. If you are in UAE then you must issue a Tax Invoice when the price of the supplies exceeds AED 10,000. So, it’s clear that there are only two conditions while making a tax invoice, the recipient of the Tax Invoice should be registered and a Tax Invoice should be issued only when the consideration of the supplies exceeds AED 10,000.

Know about Tax Invoice in UAE

In a Tax invoice, there should be more details than a simplified tax invoice. The details which a VAT invoice should be recorded are:

  • Recipient’s Name, Tax Registration Number and Address
  • Rate of tax and the payable amount in AED, the supplied quantity/volume, Price per unit,
  • Date of supply, only when it is different from the date of issue.
  • A unique invoice number.
  • The Gross Value which is Payable in AED
  • Discount, if applicable.
  • Reverse Change Statement
  • Payable Tax amount in AED.

All the details which are mandatory to be included in a tax invoice have been included above and all these information are taken from the VAT law. A Business should always be careful about all these requirements while issuing a Tax Invoice. You will have to include all these details; if you don’t then you may be charged penalties from Administrative.

There are many software available which keeps all the updates about VAT in itself with all the cc. It will be very helpful for you if you use the software to make accurate Tax invoices. It will remind you of every important detail which should be included in the Tax Invoice.

You will be charged an Administrative Penalty if you don’t include all the mandatory information in the Tax Invoice. So, it will be better if you use the software. It will automatically mention all the details which a Tax Invoice should have and you will not have to remember all those important details.  The software will also send notifications to the user if any mandatory field is empty and all the details are not included. If you are a recipient of the supplies then you must be sure about the Tax Invoice and you should verify and confirm the data of the Tax Invoice. A recipient will be able to claim an input tax deduction on the basis of the Tax Invoice so a Tax Invoice is important for both the supplier and the recipient. So, you will have to be very careful about the Tax Invoice and you will have to be sure that Tax invoices are complete and accurate.

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