Whenever you create an invoice in the UK, you need to follow the rules of His Majesty's Revenue and Customs (HMRC). The department sets specific requirements that determine what’s on the invoice, how it’s recorded, and how it fits into the larger value-added tax (VAT) system. These day-to-day details should be built into your workflow. If you get them wrong, it can lead to rejected VAT claims, delays, or problems if HMRC reviews your books.

Below, we discuss exactly what UK businesses need to know about HMRC invoice requirements, from line-item details to digital recordkeeping and VAT compliance.

What’s in this article?

• What are HMRC invoice requirements?
  
• What types of invoices are allowed under UK VAT regulations?
  
• Do businesses need to send invoices to HMRC?
  
• What are the invoicing rules for Making Tax Digital?
  
• How Stripe Invoicing can help
  

What are HMRC invoice requirements?

If you run a business in the UK, your invoices should follow a set of rules. These rules apply regardless of whether you’re VAT-registered. They help your customers know what they’re paying for, and they protect you if there’s a dispute or an audit.

Every invoice must include:

• A unique invoice number: Invoices should be numbered sequentially, with no duplicates or gaps. This helps you (and HMRC) track activity.

• Your business name, address, and contact details: Sole traders should list their own name, along with any trading name. Limited companies must use their full registered name. If you’re VAT-registered, use the name and business address tied to your registration.

• The customer’s name and address: This identifies who’s paying you.

• Invoice date and supply date: The invoice must include its own date of issue, as well as the date the goods or services were provided. Include both, even if they’re the same date. With VAT invoices, the supply date determines to which VAT period an invoice will be allocated.

• A description of what was sold: Include quantities, unit prices, and other information that explains the value provided.

• Line-item amounts and totals: Break down the cost per item or service.

• Total amount due: Show what the customer needs to pay.

If you’re VAT-registered and you’re invoicing another VAT-registered business, you’re legally required to issue a full VAT invoice that follows HMRC’s format.

In addition to the requirements listed above, a full VAT invoice must also include:

• Your VAT number: This confirms you’re registered and allows your customer to reclaim VAT.

• VAT rate and amount per item: The VAT charged for each item, the total VAT across all items on the invoice, or both. Label any items taxed at different rates (e.g., standard, reduced, zero-rated), as well as any exempt or out-of-scope items.

• Net total, VAT total, and gross total: Include the pre-VAT amount, the total VAT, and the final amount due.

What types of invoices are allowed under UK VAT regulations?

In addition to the full VAT invoice detailed above, HMRC allows two other types of VAT invoice: simplified and retailers’. While a full VAT invoice is always compliant and covers all your bases, these other two options are acceptable in particular situations.

Simplified and retailers’ VAT invoices can be used as follows:

• Simplified VAT invoice: A simplified VAT invoice is allowed for sales of £250 or less (VAT included). A simplified invoice needs only the business’s VAT number, supply date, a description of goods or services, the VAT rate used, and the total amount paid (VAT included).

• Retailers’ VAT invoice: A retailers’ VAT invoice is a type of VAT invoice used for retail sales of £250 or less when the customer wants an invoice. It contains the same fields as a simplified invoice.

Do businesses need to send invoices to HMRC?

Businesses don’t have to send invoices to HMRC unless they’re specifically asked. In general, businesses should file their VAT returns without invoices attached.

However, businesses are required by law to store their invoices for at least six years, and VAT invoices must be stored digitally in accordance with the Making Tax Digital (MTD) rules. Cloud-based systems usually handle this automatically. You’ll need these saved invoices if your business undergoes an audit or compliance check, and you’ll use purchase invoices if you claim VAT back.

What are the invoicing rules for Making Tax Digital?

If you're VAT-registered, you’re required to follow the rules set out in MTD. You must keep digital records of your VAT transactions and file your VAT returns using software that connects to HMRC’s systems.

Here’s what to remember:

• Digital VAT accounts are required: A digital VAT account is the MTD-compliant setup for managing your business’s VAT payments and charges digitally. HMRC-compliant software will generate it for you and digitally link to the HMRC.

• Each sale must be digitally recorded: Every invoice must capture the date of supply (tax point), the net amount (before VAT), and the applied VAT rate. If your software creates the invoice, you’re already covered; those fields are built in. If you make a lot of low-value sales (e.g. in retail), daily summaries at each VAT rate are allowed.

• Retyping across systems is not allowed: MTD rules don’t allow manual copy-paste or rekeying between systems. If you use multiple tools (e.g., invoicing software plus a spreadsheet), they must be digitally linked.

• Software must be “functionally compatible”: To be compliant, software must be able to store the records that HMRC requires and submit VAT returns via an HMRC application programming interface (API). Many off-the-shelf accounting or invoicing tools qualify, but some businesses bridge gaps with other software.

• Paper invoices are acceptable (for now): You can issue paper or PDF invoices to customers, but the relevant details must also be recorded digitally in your MTD-compliant system. Beginning in April 2029, electronic invoicing will become mandatory for all VAT invoices.

How Stripe Invoicing can help

Stripe Invoicing simplifies your accounts receivable (AR) process—from invoice creation to payment collection. Whether you’re managing one-time or recurring billing, Stripe helps businesses get paid faster and streamline operations:

• Automate accounts receivable: Easily create, customise, and send professional invoices—no coding required. Stripe automatically tracks invoice status, sends payment reminders, and processes refunds, helping you stay on top of your cash flow.

• Accelerate cash flow: Reduce days sales outstanding (DSO) and get paid faster with integrated global payments, automatic reminders, and AI-powered dunning tools that help you recover more revenue.

• Enhance the customer experience: Deliver a modern payment experience with support for 25+ languages, 135+ currencies, and 100+ payment methods. Invoices are easy to access and pay through a self-serve customer portal.

• Reduce back-office workload: Generate invoices in minutes and reduce time spent on collections through automatic reminders and a Stripe-hosted invoice payment page.

• Integrate with your existing systems: Stripe Invoicing integrates with popular accounting and enterprise resource planning (ERP) software, helping you keep systems in sync and reduce manual data entry.

Learn more about how Stripe can simplify your accounts receivable process, or get started today.