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

Short answer: To invoice as a UK sole trader, create a clear document that shows your name (and any trading name), a contact address, the customer’s details, a unique invoice number, the invoice date, a description of what you supplied, the amount due and how to pay. You do not need to charge VAT unless you are VAT registered, which becomes compulsory once your taxable turnover exceeds £90,000. If you are VAT registered, you must issue a full VAT invoice with extra details, including your VAT number 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 (“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 before you decide.

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; search GOV.UK’s guidance on late commercial payments for the current statutory rules. Always state your bank details or payment method clearly so there is no excuse for delay.

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.

How can Keel help me invoice and keep records?

Keel: Invoice Maker & Receipts by Ilura Technology is a private, on-device app for the self-employed. You can create invoices, capture receipts and log business trips, all stored encrypted on your iPhone, with no bank connection, no cloud and no account. Its App Store privacy label reads “Data Not Collected”.

For UK invoicing, Keel’s core value applies fully: it helps you produce clean, numbered invoices and keep a copy of every one, plus capture the receipts that support your expenses, all in one private place on your iPhone that you can hand to an accountant. You stay in control of your data because it never leaves your device.

Two honest notes for UK users. First, Keel is US-centric, so its built-in mileage rate is the IRS rate, not the HMRC rate; use its trip logging as a private record and apply the HMRC rate at tax time. Second, if you are VAT registered, always check that your invoice includes every required VAT field (your VAT number, VAT rate, VAT amount and totals) as set out by HMRC, because VAT compliance is your responsibility. The free tier covers 3 invoices per month plus unlimited receipts, with Pro for higher volume.

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 you expect to exceed it in the next 30 days). You can register voluntarily below that.

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. VAT-registered traders must add VAT details.

Can I invoice without a company or VAT number? Yes. As a sole trader you invoice under your own name (and any trading name). You only show a VAT number if you are VAT registered.

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 numbers; void or credit instead.

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. VAT records are generally kept for 6 years.

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: 3 invoices/month plus unlimited receipts; Pro is roughly the £ equivalent of $7.99/month or $59.99/year, see the App Store for local pricing).

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