Self-Billing :: Raising Non-VAT invoices in Xero

If you pay commissions to or buy goods or services from a non-VAT registered supplier, you can use Xero to produce simple self-bill invoices that can be emailed to your supplier with or before payment.

See also:

• The Ins and Outs of Self-Billing
• Self-Billing :: Raising VAT invoices with Xero

To save time creating your invoice narrative – you can set up an untracked inventory item for each self-billed supplier so that you can quickly generate a new self-billed invoice quickly. When the item is untracked, no stock is recorded making this a useful feature for creating standard sales or purchase line entries on invoices.

Preparing the invoice in Xero

1) Go to Accounts >> Inventory to add a new self-bill inventory item in Xero

2) Enter the following text into the Purchase Description field. The text should be as simple or as detailed as is appropriate for your transaction.

SELF-BILL COMMISSION INVOICE —————————————————————————————————– Commission due: £xx.xx This invoice was raised under our self-bill agreement dated dd/mm/yyyy

3) Save the new item.

 

4) Complete your purchase invoice creating a new line for each commission amount payable and approve it.

 

5) Approve the completed invoice

6) Print the PDF invoice and send a copy to your supplier. (You will note that this document prints with a comment ‘This is not a tax invoice’ at the bottom of the page – this is what makes this function (without cropping the document!) unsuitable for self-billed VAT invoices – these need to be raised outside of Xero and entered manually.)