HOME / COMMUNITY Switch to knowledge base

B2C invoice/receipt requirements

Hi,

I have a question regarding customer details required for invoices/receipts in a B2C scenario:

What amount of personal information is required on an invoice for services provided to individuals rather businesses? Do I need to record full details (full name and address) or can I aggregate them under a generic customer identity?

Background: The business is providing coaching for individuals, not businesses.

Cheers,
Michel

Assuming that your customer is not VAT registered and that they are paying you at the time of service delivery, then you only need to issue a receipt which carries your information, information as to what they are paying for, the amount paid, and the date. If they are paying you later, then you must issue an invoice. HMRC rules for invoices are given here: https://www.gov.uk/invoicing-and-taking-payment-from-customers/invoices-what-they-must-include

1 Like

Customers are NOT businesses, they are private individuals (therefore CANNOT be VAT registered!) So the HMRC link would not apply (I found that previously as well, but it only talks about payments from other businesses)

Customers usually pay by bank transfer after sending an invoice. If we had a “pay via telephone” option integrated in Quickfile that would solve the “payment at service delivery” question.

Cheers,
Michel

A receipt showing your details, description of what the payment is for, and amount paid is fine.

Never known a tesco receipt to have my personal details on it.

Individuals CAN be VAT registered as sole traders, and hence if you were offering business coaching, they would be able to reclaim any VAT charged as input tax assuming you are also VAT registered.

As HMRC explains, there is a difference between a receipt and an invoice. A receipt is an acknowledgement of payment and is what you receive at Tesco having just paid them. An invoice is a request for payment regardless of any VAT element. The HMRC link even states “The VAT amount if applicable”.

If you are VAT registered and the sale is retail, then you can issue a “simplified invoice” for transactions under £250 which does not need to carry the customer details. In general, you’ll find that HMRC are happy with you doing the same if you are not VAT registered and simply miss out any reference to VAT such as VAT number or VAT value.

The main reason for adding the customer name and address is so that you are clearly stating WHO owes you for what and how much. A retail sale is one whereby the payment is taken at the point of transaction, so there is no need to state this.

Private individuals can be VAT registered if they run a business as a sole trader and earn over the VAT threshold. I assume you are not VAT-registered, as that is the determining factor when deciding how much information to include on an invoice. If you are VAT registered, then you need to issue full VAT invoices, regardless of whether your customers are VAT-registered or not.

If not, then you can include whatever information on the invoice you feel is required.

The other consideration is whether you are producing accounts based on the accruals concept, or whether you are cash accounting. If you are cash accounting, then simple receipts are fine. If you are accruals accounting, you need enough information to be able to identify the debtor and amount invoiced, so that you can recognise the amounts owed from customers at your year-end. And so you can chase up any unpaid debts :wink: