What Is a Tax Invoice?
A tax invoice is not just any invoice. In Australia, a tax invoice is a specific document that meets requirements set by the Australian Taxation Office (ATO) under the GST legislation. It serves two critical purposes: it tells your customer how much GST they're paying, and it allows GST-registered buyers to claim GST credits on their purchases.
If you're registered for GST, you must issue a tax invoice for any taxable sale over $82.50 (including GST) when a customer requests one. You have 28 days to provide it after the request.
Getting this wrong doesn't just look unprofessional — it can mean your customers can't claim their GST credits, and you could face compliance issues with the ATO.
Tax Invoice vs Regular Invoice: What's the Difference?
A regular invoice is simply a request for payment. It can contain whatever you like — a handwritten note on a napkin technically counts.
A tax invoice is a legally defined document. It must contain specific information prescribed by the ATO. The key difference is that a tax invoice enables the recipient to claim GST credits, while a regular invoice does not.
If you're not registered for GST, you issue regular invoices and should not show a GST amount. If you are registered, every invoice for a taxable sale should be a valid tax invoice.