A tax invoice is more than just a payment request — it is a legal document required by the ATO whenever a GST-registered business supplies goods or services worth $82.50 or more (including GST). Getting it wrong can prevent your clients from claiming GST credits, which creates goodwill problems. Getting it right takes about 60 seconds with the right tool.
Who needs to issue a tax invoice?
Only businesses registered for GST can — and must — issue tax invoices. If your annual turnover is under $75,000 and you have not voluntarily registered for GST, you issue a standard “Invoice”, not a “Tax Invoice”. If you are above the threshold or voluntarily registered, every taxable sale of $82.50 or more requires a tax invoice when your client requests one.
The distinction matters because only a tax invoice enables your client to claim an input tax credit (GST refund) for their business purchases. If you fail to provide a valid tax invoice, you are making it harder for your clients to manage their own tax obligations.
What must a tax invoice include?
The ATO specifies the following mandatory fields for a valid tax invoice:
- The words “Tax Invoice” displayed prominently
- Your identity — name or registered business name
- Your ABN (Australian Business Number)
- The date the invoice was issued
- A description of what was sold (sufficiently specific)
- The GST amount payable for each taxable line item
- The total amount payable including GST
- For invoices of $1,000 or more (including GST): the buyer's identity or ABN
Note: for sales under $1,000 including GST, you do not need to identify the buyer. For sales of $1,000 or more, the buyer's name or ABN must appear on the invoice.
Step-by-step: creating a tax invoice
Step 1: Open AusInvoice and set up your details
Go to ausinvoice.com/create. The first section asks for your business name and ABN. Your ABN is validated in real time using the official ATO checksum algorithm — you will see a green tick when it is valid. If you have not set up an account, your details are saved in your browser so you do not have to re-enter them.
Step 2: Add your client's details
Enter your client's name and business name. If the invoice is $1,000 or more including GST, also enter their ABN — this is a mandatory ATO requirement for higher-value tax invoices. If you do not have their ABN, ask for it before you invoice.
Step 3: Set the invoice number and date
Invoice numbers should be unique and sequential. Use a consistent format like INV-001, INV-002 or 2026-001, 2026-002. The date should be the date of supply or the date the invoice is issued, whichever comes first. Never backdate invoices.
Step 4: Add your line items
Describe each product or service clearly. “Website design — homepage and 5 internal pages” is specific enough; “Web services” is not. Include quantity and unit price for each item. AusInvoice calculates the line item total automatically.
Step 5: Configure GST
Toggle GST on. Choose whether your prices are GST-exclusive (GST will be added on top) or GST-inclusive (GST will be extracted from the price). AusInvoice calculates the 10% GST and shows it as a separate line between the subtotal and total. The document title automatically changes to “Tax Invoice”.
Step 6: Add payment details and terms
Include your BSB and account number, or PayID. Set your payment terms (7 days, 14 days, 30 days) and the actual due date will be calculated. Including bank details has a significant impact on how quickly you get paid — it removes the friction of your client having to find your banking details separately.
Step 7: Preview and download
Review the live preview on the right side of the screen. Check all amounts, your ABN, and the client details. When you are satisfied, click Download PDF. Your ATO-compliant tax invoice is ready to email.
Common mistakes when creating tax invoices
- Missing ABN: Your ABN must appear on every tax invoice. Without it, your client cannot claim input tax credits.
- No “Tax Invoice” heading: The ATO requires these words to appear prominently. A document simply called “Invoice” does not qualify as a tax invoice.
- Vague descriptions: “Services rendered” is not acceptable. Be specific about what you provided.
- Not showing GST amount: The GST must be shown separately, not just embedded in the total price.
- Missing buyer details on large invoices: Invoices of $1,000+ must include the buyer's identity or ABN.