Self-Employed Invoice UK: Sole Trader Requirements

If you’re self-employed in the UK — a sole trader, freelancer or contractor — your invoices need to meet a few legal basics, and a few more once you register for VAT. This guide sets out what to include, with examples, and covers the related rules on business names, late payment and record keeping.

UK rules and thresholds change. This guide reflects the position as generally understood in October 2026 and is not legal or tax advice. Check GOV.UK or ask an accountant for your situation.

What a sole trader’s invoice must include

GOV.UK’s guidance for invoices (if you’re not VAT-registered) lists:

• A unique identification number (sequential is best — see invoice numbering)
• Your name (or business name) and address
• The customer’s name (or business name) and address
• A clear description of what you’re charging for
• The date the goods or service were provided (supply date)
• The date of the invoice
• The amount(s) being charged
• The total amount owed

Sensible additions: your email and phone, payment terms and a due date, bank details (account name, sort code, account number), and the client’s PO number if they use one.

Using a business name

If you trade under a name that isn’t your own surname (e.g. “Blue Fern Design” rather than “Jane Smith”), UK business names rules require you to show your own name and an address where documents can be served on business documents, including invoices. Example: “Jane Smith trading as Blue Fern Design, 12 Market Street, Leeds LS1 4AB.”

When you need to register for VAT

You must register for VAT if your VAT-taxable turnover exceeds the registration threshold — £90,000 over a rolling 12-month period since April 2024 — or you expect to exceed it in the next 30 days alone. You can register voluntarily below the threshold.

If you’re not VAT-registered:

• Don’t charge VAT or show a VAT amount
• Don’t call your invoice a “VAT invoice”
• You don’t need to state that you’re not registered, though some sole traders add “Not VAT registered” to avoid client queries

VAT invoices (once registered)

A full VAT invoice must also show:

• Your VAT registration number
• The time of supply (tax point) if different from the invoice date
• For each item: description, quantity, unit price excluding VAT, VAT rate
• Total excluding VAT, total VAT, and the total including VAT
• Any discount
• Where the reverse charge or zero-rating applies, a note explaining it

Standard rate is 20%; reduced (5%) and zero rates apply to specific goods and services. If you invoice in a foreign currency, the total VAT must be shown in sterling — see invoicing in a foreign currency.

Simplified VAT invoices are allowed for retail supplies of £250 or less (including VAT). Use our VAT calculator to add or remove VAT, and see how to charge VAT on invoices for EU clients and the reverse charge.

Example: non-VAT-registered sole trader

Payment by bank transfer to J Smith, sort code 00-00-00, account 12345678, ref BFD-2026-0042. Not VAT registered. (Placeholder bank details.)

Payment terms and late payment

For B2B invoices, the Late Payment of Commercial Debts (Interest) Act 1998 lets you claim statutory interest at 8% above the Bank of England base rate on late payments, plus fixed compensation of £40, £70 or £100 depending on the debt size — unless your contract sets a different, substantial remedy. If no payment date is agreed, the law sets a default of 30 days. Put your terms on the invoice and in your contract, and see late payment reminder templates for chasing. The late fee calculator can help you work out amounts.

These statutory rights don’t apply to invoices to consumers.

CIS (construction)

If you work in construction as a subcontractor, the Construction Industry Scheme generally requires contractors to deduct tax from your payments (20% if you’re registered with HMRC, 30% if not) and give you payment and deduction statements. Your invoice should separate labour from materials, since deductions apply to labour only. VAT-registered construction businesses may also be subject to the domestic reverse charge.

Records and tax

• Keep copies of all invoices, receipts and bank records. For Self Assessment, records generally must be kept for at least 5 years after the 31 January submission deadline of the relevant tax year.
• Your invoices feed your Self Assessment tax return (deadline for online returns: 31 January after the end of the tax year on 5 April).
• Making Tax Digital for Income Tax is being phased in for sole traders and landlords: as announced, from April 2026 for those with qualifying income over £50,000, April 2027 over £30,000 and April 2028 over £20,000. It requires digital records and quarterly updates through compatible software. Check whether and when it applies to you.

Practical tips

• Invoice promptly when work is delivered, with an explicit due date.
• For new clients, ask who processes invoices and whether they need a PO number.
• Keep a simple register of invoice numbers and payments; your accountant will thank you.
• Use your own name and address consistently across invoices, your bank account and your HMRC registration.

Create a UK invoice in the invoice generator — set the currency to GBP and, if registered, the tax name to VAT. Our UK invoice template page summarises the requirements in one place, and how to invoice as a freelancer covers the workflow.