How to Prepare a Tax Invoice Form

Calculating tax and creating invoices

To charge sales tax on items sold, every business is required to keep a record of said transaction for tax purposes. Therefore, a tax invoice form is an important tool, for any business to keep track of sales tax and payment status of your customers purchases. There are several websites where you can download tax invoice templates, which calculate the taxes and grand total for you. Once downloaded, fill in the blanks with the required information print and save when complete and provide the customer with a paper copy. Do not confuse a regular sales invoice with a tax invoice. With a regular sales invoice you have a record of the purchase, not the tax on the purchase.

Instructions

1. Assign an invoice number. This may automatically appear if the template is designed with a starting number, for example 001.

2. Fill in the reference section of the invoice form with the account name or number, item(s) purchased and date of purchase. If the customer is making payments you can then add the terms (days), due date of payment and the description of purchase.

3. Complete the customer's information in the "Issued To" section of the tax invoice form, which includes; business name, contact information, business telephone and fax number, address and email, if appropriate. If the items are to be shipped, such as an online purchase or a phone order, fill in the shipper's information.

4. Enter in the table below, the information detailed description of item purchased, quantity/unit type, price per unit and discount, if any. Fill this in as many times as there are items purchased. The invoice template you downloaded will calculate the net amount, total tax and grand total. Then complete the section for amount paid and amount due.

5. Complete the bank information if the customer chooses to pay you via direct deposit. This is found at the bottom of the invoice. Or if the customer chooses to pay with their credit card, fill in the appropriate information to make the charge. With each payment fill in the payment history with the date and amount. This is important as it shows you the customers who pay in a timely manner and those who do not.

References

• Invoice Place: Invoice Template
• ECB Council: Tax Laws