Invoicing from WhatsApp: what the law needs on a South African invoice

First: are you a VAT vendor?

Everything else follows from this. If you are registered for VAT, you issue tax invoices and the Value-Added Tax Act tells you exactly what has to be on them. If you are not registered, you issue ordinary invoices — and you may not charge VAT, call the document a tax invoice, or show a VAT number you do not have.

That last point is the mistake worth naming early, because it is common and it is expensive. A small operator copies an invoice template from someone bigger, leaves the "VAT @ 15%" line on it, and is now collecting money as if it were tax. SARS treats that seriously. If you are not registered, delete the VAT line.

VAT registration is compulsory once your taxable turnover passes R1 million in any twelve-month period, and voluntary below that above a lower threshold. If you are anywhere near it, that is an accountant conversation, not a website one.

What an ordinary invoice should carry

If you are not a VAT vendor, the law is far lighter on you, but a customer — especially a business customer — needs enough to pay you and to put the cost in their own books. In practice that means:

• Your business name and contact details, and your registration number if you have one
• The customer's name, and their address where you have it
• A unique invoice number, in a sequence you keep
• The date of issue
• A description of the work, and where it was done
• The amount due, and your payment terms
• Your banking details

Keep a copy. The Companies Act and the Tax Administration Act both expect business records to be retained for five years, and an invoice is a business record whether or not it is a tax invoice.

What a full tax invoice must carry

Section 20 of the Value-Added Tax Act sets out the particulars for a tax invoice, and SARS publishes the same list in its VAT guidance. A full tax invoice must contain:

• The words "Tax Invoice", "VAT Invoice" or "Invoice"
• The name, address and VAT registration number of the supplier — you
• The name and address of the recipient, and their VAT registration number where they are a vendor
• An individual serialised number
• The date on which the tax invoice is issued
• A description of the goods or services supplied
• The quantity or volume supplied
• Either the value, the VAT charged and the total; or the total with a statement that it includes VAT and the rate charged

Two formats for the money, in other words: you can break it out, or you can state a VAT-inclusive total and say so. Both are acceptable; pick one and be consistent.

The R5,000 rule, and what it lets you leave out

Where the consideration for the supply is R5,000 or less, an abridged tax invoice is allowed. It still needs the words "Tax Invoice", your name, address and VAT number, the date, a serial number, a description of what was supplied, and the money treated the same way as above — but you do not have to carry the recipient's details or the quantity.

For a trade business this covers most callouts and small repairs, which is exactly the work that currently goes unbilled. It is worth knowing that the compliant version of that invoice is short.

Below R50, no tax invoice is required at all, though you still need a document showing the VAT — a till slip does it. That threshold rarely matters on site.

Sending it from a phone

None of the above says anything about paper, and none of it says anything about email. A tax invoice can be issued electronically. What matters is that the document contains the required particulars, that it is issued within twenty-one days of the supply, and that you keep a copy you can produce later.

So a PDF sent over WhatsApp is a perfectly good tax invoice, provided the PDF says the right things. What is not a tax invoice is a WhatsApp message reading "that'll be 3800 thanks" — which is how a great deal of trade work is currently billed.

Where Orbit fits

Orbit is being built so that the record you make in a WhatsApp message becomes a document that carries these particulars: your details, the customer, a serial number, the date, a description of the work, and the money in one of the two accepted forms. You read the draft and you send it — Orbit drafts, you send.

Orbit is in development and has no launch date. Until it opens, the practical version of this article is: make a template with the fields above, number your invoices in one sequence, and never put a VAT line on a document if you are not registered.

This is general information, not tax advice. SARS and your accountant are the authorities on your own situation, and the VAT Act is the authority on the list above.