Freelancers’ Questions: How to invoice without my VAT number?

Freelancer’s Question: How do I go about drawing up and issuing an invoice if I’ve registered for VAT but am yet to receive my VAT number?

Expert’s Answer: Issuing invoices before your VAT number arrives is a common task for freelancers. What you need to do is work out how much you would have charged your customer including VAT and then send them an invoice for that amount. So for example, if your fees would total £1,000, and the services you’re supplying are standard-rated for VAT (most are), then you would invoice your customer for £1,200. That’s worked out as £1,000 plus 20% VAT. But what you mustn’t do just yet is to show that £200 as a separate line on the invoice.

Once you have your VAT number, go back and re-issue that invoice to your customer, showing the VAT as a separate line this time, and with your VAT number on it, to make sure it’s a valid VAT invoice. That way, your customer can reclaim the VAT you charge to them.

Bear in mind, HMRC does say that you should do it this way rather than charging your customer for the amount before VAT first and then sending them a separate invoice for the VAT amount alone.

The expert was Emily Coltman ACA, chief accountant at Free Agent , an online accounting platform tailored to freelancers and the self-employed.


4th April 2016

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