How to Invoice as a Sole Trader in the UK (+ VAT Rules)

Short answer: how to invoice as a sole trader in the UK comes down to one document showing your name and any trading name, a contact address, the customer’s details, a unique sequential invoice number, the date, a description of what you supplied, the amount due and how to pay. Charge VAT only if you are VAT registered, which becomes compulsory once your taxable turnover exceeds £90,000 — a VAT invoice then also needs your VAT number, the rate per item and the VAT charged. Keep a copy of every invoice for at least 5 years.

Invoicing is how you get paid and how you prove your income to HMRC, so it is worth getting right from your first job. The good news: a compliant sole trader invoice is simple, and once you have a template you can reuse it.

What must a sole trader invoice include?

Even a basic (non-VAT) invoice has required elements. According to GOV.UK’s guidance on invoicing and taking payment from customers, a sole trader invoice must include your name and any business name you use, and an address where legal documents can be delivered if you trade under a business name.

Here is a complete checklist for a standard sole trader invoice:

• The word “Invoice” clearly on the document
• A unique invoice number (sequential, no gaps)
• Your name and any trading name
• Your contact address (for legal documents if you use a business name)
• The customer’s name and address
• The invoice date (and supply date if different)
• A clear description of the goods or services
• The quantity and price per item
• The total amount due
• Payment terms and how to pay (bank details, due date)

You do not have to show a VAT amount unless you are VAT registered.

Do I need to charge VAT as a sole trader?

Only if you are VAT registered. Most new sole traders are not.

You must register for VAT when your taxable turnover exceeds the registration threshold, which is £90,000 (in place since 1 April 2024, per GOV.UK). Specifically:

• Register if your taxable turnover in any rolling 12-month period goes over £90,000, or
• If you expect to go over £90,000 in the next 30 days alone.

The deregistration threshold is £88,000. You can also register voluntarily below £90,000, for example to reclaim VAT on purchases. Confirm current thresholds on GOV.UK’s VAT registration page before you decide, because the figure is set at each Budget and the rolling test catches people who never expected to cross it.

What is the difference between a standard invoice and a VAT invoice?

If you are VAT registered, your invoices must show more information.

Element	Standard (non-VAT) invoice	Full VAT invoice
Unique invoice number	Required	Required
Your name and address	Required	Required
Customer details	Name and address	Name and address
Description of goods/services	Required	Required
Your VAT registration number	Not applicable	Required
Rate of VAT per item	Not applicable	Required
Price excluding VAT per item	Optional	Required
Total excluding VAT	Optional	Required
Total VAT charged	Not applicable	Required
Amount payable including VAT	Total due	Required

Source: GOV.UK, “Invoicing and taking payment from customers: Invoices - what they must include” and HMRC VAT invoice guidance.

If both you and your customer are VAT registered, you must issue a VAT invoice. The standard UK VAT rate is 20%, with reduced (5%) and zero rates for some goods and services; check which rate applies to what you sell.

How should I number my invoices?

Invoice numbers must be unique and sequential with no gaps, because HMRC uses them to check your records are complete. Simple, reliable schemes include:

• Plain sequence: 001, 002, 003
• Year prefix: 2026-001, 2026-002
• Client code: ACME-001, ACME-002

Pick one system and stick to it. If you cancel an invoice, do not delete the number; issue a credit note or mark it void so the sequence stays intact.

What payment terms should a sole trader set?

Payment terms tell the client when and how to pay. Common choices:

• Due on receipt for small or one-off jobs
• Net 14 or Net 30 (payment within 14 or 30 days) for regular clients
• A clear late payment note

UK law allows businesses to charge interest and reasonable costs on late commercial payments; check GOV.UK for the current statutory rules before you put a figure on a demand. Always state your bank details or payment method clearly so there is no excuse for delay, and put the interest entitlement in the footer: it costs you nothing, and it is the mildest of the levers covered in how to get clients to pay.

Do I have to keep copies of my invoices?

Yes. Invoices are a core part of your income records. HMRC requires self-employed people to keep business records, including copies of invoices issued, for at least 5 years after the 31 January submission deadline of the relevant tax year. VAT-registered traders generally keep VAT records for 6 years (verify on GOV.UK).

Store copies somewhere reliable and backed up, and make sure you can retrieve any invoice quickly if HMRC asks. Invoices are only one of the records you are expected to hold; sole trader bookkeeping covers the rest, and the income they add up to is what you declare on your Self Assessment return.

How can Keel help me invoice and keep records?

An invoice is only half a record. The other half is the receipts proving what a job cost you and the trips you made doing it — the parts that go missing, because nobody photographs a fuel receipt at eleven at night.

Keel: Invoice Maker & Receipts by Ilura Technology runs entirely on your iPhone: no account, no sign-in, no bank connection and no cloud. Its App Store privacy label reads “Data Not Collected”. You build invoices as PDFs with your own numbering sequence, logo, brand colour and a payment link rendered as a QR code, photograph receipts for Apple Intelligence to read on device, log business trips, and export the whole year as a single file for your accountant. Everything lands in an append-only, hash-chained ledger held on the device and nowhere else, so the copies stay retrievable in the way HMRC expects — provided you keep the iPhone itself backed up, because on-device also means there is no second copy on someone’s server.

The honest tradeoff: nothing imports itself. With no bank feed there is no automatic import, so every invoice is typed and every receipt is photographed — the direct cost of data never leaving the phone. VAT also stays your responsibility: if you are registered, check each invoice carries your VAT number, the rate per item, the VAT charged and the totals before you send it. The free tier covers unlimited invoices, receipts and mileage; Keel Pro is a one-time purchase that adds branding, reports and the Accountant Pack (a CSV plus a one-page summary PDF).

Frequently asked questions

Do I need to charge VAT as a sole trader? No, unless you are VAT registered. Registration is compulsory once your taxable turnover exceeds £90,000 in any rolling 12-month period, or when you expect to pass it in the next 30 days alone. You can register voluntarily below that, usually to reclaim VAT on purchases, but you must then charge VAT on your taxable sales from your effective date of registration.

What information must a sole trader invoice include? Your name and any trading name, a contact address, the customer’s details, a unique invoice number, the date, a description of what you supplied, the amount due and how to pay. If you trade under a business name, that address must be one where legal documents can be delivered. VAT-registered traders add their VAT number, the rate per item and the VAT charged.

Can I invoice without a company or VAT number? Yes. As a sole trader you invoice under your own name, plus any trading name you use, and there is no company registration number to quote because there is no company. You only show a VAT number once you are VAT registered — and you must never show a VAT amount before that, because it implies you are collecting tax you have no authority to collect.

How do I number invoices correctly? Use a unique, sequential system with no gaps, such as 001, 002, 003 or 2026-001. Never reuse or delete a number: if a job falls through, issue a credit note or mark the invoice void so the sequence stays unbroken. Gaps are among the first things a compliance check queries, because a missing number suggests an invoice was raised and then taken out of the records.

How long must I keep copies of invoices? At least 5 years after the 31 January Self Assessment deadline for that tax year, per GOV.UK. In practice an invoice raised in the 2025/26 tax year is therefore kept until at least 31 January 2032. VAT records are generally kept for 6 years. If HMRC has an enquiry open, hold everything until that is settled, however long it takes.

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The bottom line

Invoicing as a UK sole trader is straightforward: include your details, the customer’s details, a unique number, a clear description and the amount due, and add VAT information only if you are VAT registered (compulsory above £90,000 turnover). Number invoices in sequence and keep a copy of every one for at least 5 years. A private, on-device app like Keel can generate and store those invoices, and capture supporting receipts, without your data leaving your iPhone. Confirm current VAT rules on GOV.UK and ask an accountant if you are unsure.

Try Keel on the App Store: https://apps.apple.com/us/app/keel-invoice-maker-receipts/id6786659713 (Free with unlimited invoices, receipts and mileage; Keel Pro is a one-time $249.99 Lifetime purchase, not a subscription — see the App Store for local pricing).

This article is general information, not tax advice. Consult a qualified accountant or tax adviser.