Issuing a properly filled out sales invoice to our customer is important for accounting and tax purposes. However, most businesses neglect to do this properly.
In this blog article, we will try to explain the importance of issuing a correct sales invoice, and how to do it.
What is a Sales Invoice?
- Sales Invoice serves as your legal evidence of your sales. Like any other legal documents, it should be properly documented.
- Sales Invoice are monitored and regulated by the Bureau of Internal Revenue (BIR). The BIR is responsible in monitoring and collecting taxes thereof.
- Sales Invoice shows the details of your sales. It includes the following:
- No of Item sold
- Unit of Measurement
- Description of Item
- Selling Price per Item
- Total Sales
- VAT
- Name of Customer
- Address
- Date of Sale
How to Make a Sales Invoice?
Here are the basic steps in making and issuing a sales invoice:
1. Write the information of your customer, such as the following:
- Full Name
- Address
- Date
- Taxpayer Identification Number (TIN), if applicable
- Contact Details such as telephone or mobile number
2. Write details of the items sold, such as:
- Quantity of item sold
- Measurement
- Description of Item Sold
- Unit Selling Price
- Total Sales Per Item
3. Add the total sales per item to get the grand total.
4. Determine the tax, in the form of Value-Added Tax (VAT), and the Vatable Sales. Here’s how:
- Vatable Sales = Total Sales/ 1.12
- VAT = Vatable Sales x 1.12
- Total Sales = Vatable Sales + VAT
5. Ask the customer to sign the sales invoice.
6. Last but not the least, sales invoice should be issued in chronological order (in series).
janice de belen cagata says
please teach me how to compute sales discount in the new BIR sales invoice issued if not a senior citizen.
Maria Lourdes M. Yanuaria, CPA says
Thank you for your comment. We’ll discuss your question on our future articles.
janice de belen cagata says
please let me know the answer.thank you
Eric says
Please check your formula for VAT. It says “Vatable sales x 1.12”. I believe it should only be “x .12”.
Thanks!
mary- an capacio says
i just want to know if it is right that we computed customer’s discount based on the amount net of vat
randy says
Your formulation of how to compute VAT is not correct! It should be 0.12.
Anne says
Please teach me how to compute Sales Invoice in NON-VAT. Thanks!