Philippines Invoice Template

The Bureau of Internal Revenue requires invoices to include your business name, VAT number, invoice number, date, detailed item descriptions, quantities, unit prices, VAT amount, and total due. Both seller and buyer information must be clearly displayed. Philippine invoices used for VAT purposes must follow BIR-prescribed formats, especially when claiming input tax credits. Businesses registered with the BIR should ensure all mandatory fields are present to support tax filings and withstand audits.

VAT in the Philippines is calculated at 12% on the selling price of goods and services. Multiply the subtotal by 0.12 to get the VAT amount, then add it to reach the total due. For VAT-exempt transactions, such as certain agricultural or medical services, mark the invoice as "VAT-exempt" instead. Your business registration status—whether VAT-registered or non-VAT-registered—affects how VAT appears on the invoice. Verify your registration status with the BIR to ensure correct VAT treatment on all invoices.

Common payment terms include cash on delivery (COD), net 15, net 30, or net 60 days, depending on your industry and business relationships. Larger corporations typically negotiate extended terms, while smaller transactions often require immediate payment. Clearly state the payment deadline and list acceptable payment methods—bank transfer, check, or cash. If offering an early payment discount, specify the discount percentage and deadline. Explicit payment terms prevent misunderstandings and improve cash flow management.

Include your complete business name, official registered address, business permit number, and VAT registration number if applicable. Add a contact phone number and email for client inquiries. If operating under a registered trade name different from your legal entity name, include both names for clarity. For freelancers or sole proprietors, your professional name and business address suffice. This section establishes your business identity and allows clients to verify your legitimacy for tax deduction purposes with the BIR.

Digital services provided by Philippine-registered businesses are subject to 12% VAT, the same as traditional services. Non-resident foreign service providers may face different rules depending on client location and applicable tax treaties. Local digital service providers offering web development or design must include VAT on invoices to VAT-registered clients. Non-VAT-registered businesses cannot charge VAT. Always clarify your VAT registration status on the invoice so clients understand their tax obligations for business expense deduction.

Invoice numbers must be unique and sequential to track transactions chronologically. A practical format is YYYYMMDD-### (date-based), like 20250616-001, making it easy to organize records by date. Some businesses use simple sequential numbering such as INV-001, INV-002. The BIR doesn't mandate a specific format, but numbering must remain consistent and consecutive for audit purposes. Maintain records linking each number to its corresponding transaction and include the invoice number prominently on every document.

USD and other foreign currencies are acceptable for invoices to Philippine clients if both parties agree, particularly for international service providers. If invoicing in USD, specify the exchange rate applied and provide the PHP equivalent for reference, especially when clients claim tax deductions. Include a note clarifying whether payment is expected in PHP or USD. When accepting foreign currency, specify the payment method (wire transfer, online platforms) and notify clients of any conversion fees they'll encounter.

Philippine businesses must retain invoice copies for at least five years for tax compliance and audit readiness. The BIR may request invoices during examinations to verify reported income and input tax credit claims. Store invoices securely—either in organized physical files or digital systems with backup copies. Records must be accessible for BIR review and business reference. Retention requirements apply to all invoices regardless of whether transactions are domestic or international; non-compliance can result in penalties.