Definition
A tax invoice is the invoice a VAT- or GST-registered supplier issues for a taxable supply, showing the tax charged so the buyer can reclaim it as input tax.
What is a tax invoice used for?
Tax authorities set what a tax invoice must show. Typical requirements include the words “Tax invoice”, the supplier’s tax registration number, the date, a description of the supply, the taxable amount, the tax rate and the tax due, and for many business sales the buyer’s details too. Buyers need a valid tax invoice to reclaim input VAT, so missing details can block their claim.
Some countries also require tax invoices to be issued as e-invoices. In Saudi Arabia that has applied since 4 December 2021 under ZATCA rules, and the UAE’s mandatory e-invoicing starts in 2027.
Example: a trader bills SAR 10,000 plus 15% VAT of SAR 1,500, a total of SAR 11,500, showing its 15-digit VAT registration number. A proforma invoice is not a tax invoice.