The Short Answer
To invoice as a sole trader in Australia, get an ABN first. Then send each client an invoice with a unique number, your name or registered business name, your ABN, the date, what you did, the amount, a due date and how to pay. Email it as a PDF and keep a copy.
If you are registered for GST, call it a tax invoice and show the GST. If you are not, call it an invoice and leave GST off. You must register for GST once your turnover reaches $75,000 a year.
Most people who start out as a sole trader in Australia learn invoicing the hard way. The first client asks for an ABN you have not applied for yet. The second wants a "tax invoice" when you are not registered for GST. The third pays 60 days late because you never wrote a due date. None of it is complicated, but nobody explains it in order.
This guide does. It walks through what to set up before you send anything, the eight steps of sending an invoice, the difference GST makes, a full worked example, how to get paid on time, what to do when a client does not pay, and what records to keep for tax time. If you only need the blank template, use the sole trader invoice template for Australia.
The Numbers Every Sole Trader Needs
| Rule | Number | What it means for your invoices |
|---|---|---|
| No ABN withholding | 47% | A business that pays an invoice without your ABN must keep 47% and send it to the ATO |
| GST registration | $75,000 turnover | Below it GST is optional; at or above it you must register and issue tax invoices |
| GST rate | 10% | Added to taxable sales once you are registered |
| Small sale exemption | $82.50 including GST | No tax invoice needed at or below this, unless the customer asks |
| Buyer details on a tax invoice | $1,000 including GST | From this amount the tax invoice must show the buyer's name or ABN |
| Tax invoice on request | 28 days | If a customer asks for a tax invoice, you must provide it within 28 days |
| Record keeping | 5 years | Keep every invoice you send and receive for five years |
| Tax free threshold | $18,200 a year | Resident individuals pay no income tax on the first $18,200 of taxable income |
These figures come from the ATO and apply to sole traders across every state and territory. The GST and tax free thresholds can change in a federal budget, so check the ATO site once a year.
Before Your First Invoice
1. Apply for an ABN
An Australian Business Number is an 11 digit number that identifies your business to the ATO and to other businesses. Apply through the Australian Business Register. It is free when you apply directly. Many sole traders get theirs the same day, although some applications take longer when the register needs more information.
You need an ABN because business clients are required to withhold 47% from any payment to a supplier who does not quote one. On a $2,000 job that is $940 you will not see until you lodge your tax return. Put your ABN on every invoice, whether or not you are registered for GST. The ABN invoice template shows where it goes.
2. Decide what name you will trade under
You can trade under your own name, such as Jordan Lee, with no registration. If you want to trade under any other name, such as Lee Landscaping, you must register it as a business name with ASIC before you use it. Your invoice should then show the registered business name, and many sole traders add their own name underneath so the client knows who they are dealing with.
3. Decide whether to register for GST
If you expect your turnover to reach $75,000 a year, you must register within 21 days of knowing it. Below that you can choose. Registering lets you claim back GST on business purchases, but it also means adding 10% to your prices and lodging Business Activity Statements. If most of your clients are GST registered businesses, the extra 10% costs them nothing because they claim it back. If your clients are households, it makes you 10% dearer.
4. Open a separate bank account
It is not a legal requirement for a sole trader, but it is the single most useful thing you can do for your records. Every payment that lands in that account is business income, and every payment out is a business expense you can check at tax time. Set up a PayID on it, usually your email address or ABN, so clients can pay instantly without typing a BSB and account number.
5. Agree the price before you start
Arguments about invoices are almost always arguments about what was agreed. For anything bigger than a small job, send a written quote first and get a yes in writing. A text message counts. Our quote generator turns a quote into an invoice later with the same details.
How to Invoice as a Sole Trader in 8 Steps
Once you are set up, every invoice follows the same eight steps. After the first few it takes about two minutes.
| Step | What to do | Why |
|---|---|---|
| 1. Title it | "Invoice", or "Tax Invoice" if you are GST registered | Only GST registered businesses may use "Tax Invoice" |
| 2. Number it | A unique number such as INV-0001, then INV-0002 | Makes payments easy to match and records easy to check |
| 3. Add your details | Name or business name, ABN, address, email, phone | The ABN stops the 47% withholding |
| 4. Add the client | Their name or business name, and ABN for business clients | Required on a tax invoice of $1,000 or more |
| 5. Describe the work | Each item or job, the quantity or hours, and the price | A clear description gets approved and paid faster |
| 6. Show the total | The subtotal, the GST if registered, and the total due | Your client claims the GST back from this line |
| 7. Set terms | A due date in full, plus your BSB and account or PayID | An invoice with no date gets paid last |
| 8. Send and record | Email it as a PDF, save a copy, note it in your records | You need it for your BAS and tax return |
A few practical points on these steps. Number invoices in one sequence for your whole business, not per client, and never reuse a number. Our guide to invoice numbering has simple formats. Write the due date as a date, such as "Due 6 November 2026", rather than "14 days". And send a PDF, not a Word document or a photo, so the layout cannot shift and the numbers cannot be edited.
Invoice or Tax Invoice? How GST Changes Things
This is where most new sole traders get confused, so here it is side by side.
| Item | Not registered for GST | Registered for GST |
|---|---|---|
| Title | Invoice | Tax Invoice |
| ABN | Yes, always | Yes, always |
| GST line | No, and do not charge GST | Yes, 10% on taxable items |
| Buyer details | Good practice | Required from $1,000 including GST |
| Fixing a mistake | Issue a credit note or a corrected invoice | Issue an adjustment note |
| Lodging | Income goes in your yearly tax return | Also a Business Activity Statement, usually quarterly |
If you are not registered, a helpful line on the invoice is "No GST has been charged as the supplier is not registered for GST." It heads off the question from your client's bookkeeper. Our no GST invoice template includes it. If you are registered, the full list of what a tax invoice must show, including adjustment notes and recipient created tax invoices, is on the tax invoice template page.
A Worked Example
Jordan is a sole trader gardener in Brisbane, trading as Lee Landscaping, registered for GST. A real estate agency asks for a garden tidy at a rental property. The invoice is headed TAX INVOICE, numbered INV-0048 and dated 23 October 2026. It shows Lee Landscaping with Jordan's own name, ABN, Brisbane address and email, then the agency's business name and ABN. The lines look like this.
| Line | Detail | Amount |
|---|---|---|
| Labour | Garden tidy, 6 hours at $75 | $450.00 |
| Materials | Mulch, 2 cubic metres | $180.00 |
| Green waste | Tip fee | $60.00 |
| Subtotal | Before GST | $690.00 |
| GST | 10% of $690.00 | $69.00 |
| Total due | Due 6 November 2026, by PayID or BSB and account | $759.00 |
The total is under $1,000, so the agency's details are not strictly required on the tax invoice, but Jordan includes them because agencies pay faster when the invoice names them and the property. If Jordan were not registered for GST, the same invoice would say INVOICE, drop the GST line, and total $690.00.
Getting Paid on Time
Australia has no default payment term for most small business invoices. You set the term, and the client agrees to it when they accept your quote or your terms. Common choices are 7 days for households and 14 or 30 days for businesses. Shorter terms get paid faster, but a large company may simply pay on its own cycle whatever you write.
A few habits make a real difference:
- Invoice the day the job ends. Every day you wait is a day added to when you get paid.
- Make paying easy. Put your PayID and your BSB and account number on the invoice, with the invoice number as the reference.
- Take a deposit on big jobs. Our guide to deposits and upfront payments explains how to invoice for one.
- Think twice before adding a card fee. Since 1 October 2026 you cannot surcharge eftpos, Mastercard or Visa card payments. Read what the card surcharge ban means for your invoices.
- Know how government pays. Australian Government agencies pay correctly rendered e-invoices faster than emailed PDFs under the Supplier Pay On-Time or Pay Interest Policy. If you work for an agency, see Peppol e-invoicing.
When a Client Does Not Pay
Most late payments are forgetfulness, not refusal. Work up in steps and keep it polite and in writing.
- On the due date: a short friendly reminder with the invoice attached again.
- 7 days late: a firmer reminder that names the amount and the original due date. The payment reminder generator writes these for you.
- 14 to 30 days late: a phone call, then a written letter of demand with a final date.
- Still unpaid: the Australian Small Business and Family Enterprise Ombudsman offers help with disputes, and each state has a tribunal or local court for small claims.
You can only charge late payment interest if it was part of your agreed terms before the work started. If you want that option, put it on your quotes and invoices from day one, for example "Overdue amounts may attract interest at 10% a year". The late payment fee calculator works out the figure. Our full guide to handling late payments has templates for each step.
Records and Setting Aside Tax
Keep every invoice you send and every receipt for what you buy for five years. A PDF in a folder for each financial year, backed up off your laptop, is enough. Note when each invoice was paid, because if you are GST registered you will need to know which quarter each payment belongs to.
Nobody takes tax out of what your clients pay you. As a sole trader you report your business income in your own tax return, and you pay income tax on your taxable income above the $18,200 tax free threshold. Once your business income grows, the ATO may put you into PAYG instalments, so you pay tax through the year instead of in one lump. Until then, a separate savings account where you move a share of every payment, often around a quarter, stops tax time from being a shock. A registered tax agent can tell you the right share for your income.
If you are GST registered, the GST you collect is not your money. Put it aside the day it arrives, because it goes to the ATO with your next BAS.
Mistakes That Cost Money
| Mistake | What it costs | The fix |
|---|---|---|
| No ABN on the invoice | 47% of the payment withheld | Put your ABN on every invoice |
| "Tax Invoice" when not registered | Confused clients, and charging GST you cannot legally collect | Call it an invoice and leave GST off |
| Trading under an unregistered business name | A breach of business name law | Register the name with ASIC, or use your own name |
| No due date | Weeks of waiting | A date in full on every invoice |
| Editing a sent invoice | Records that do not match the client's | Issue a credit or adjustment note |
| Missing the GST threshold | GST owed on sales you never charged it on | Check your turnover every month as you get close |
The common thread is that every one of these is fixed before you hit send. Our list of common invoicing mistakes covers the rest.
Frequently Asked Questions
Can I invoice as a sole trader without an ABN?
You can send an invoice, but a business client must then withhold 47% of the payment and send it to the ATO, unless an exception applies such as a hobby or private payment. Apply for an ABN through the Australian Business Register before you invoice. It is free when you apply directly.
Do I need to register for GST to send invoices?
No. You only have to register for GST once your turnover reaches $75,000 a year. Until then you send ordinary invoices without GST. Taxi and ride sourcing drivers are the exception and must register from the start.
What is the difference between an invoice and a tax invoice?
A tax invoice is the version issued by a GST registered business. It must say "Tax Invoice", show the ABN and the GST, and from $1,000 show the buyer's details. If you are not registered for GST, you issue an invoice instead.
Can I use my personal bank account for business payments?
Yes, a sole trader can, because the business and the person are the same legal entity. A separate account is still strongly recommended because it keeps your records clean and makes your tax return and any ATO review far simpler.
What payment terms should a sole trader use?
There is no fixed rule for most small business invoices. Seven days is common for households and 14 or 30 days for businesses. Whatever you choose, write the due date in full on the invoice and agree it in your quote.
Can I charge interest on late invoices?
Only if your client agreed to it before the work began, usually because it was written in your quote or terms. Without that agreement, your options are reminders, a letter of demand and, if needed, a small claims tribunal.
How long do I keep my invoices?
Five years. Keep copies of the invoices you send and the receipts and invoices you receive, in paper or digital form, for five years from when you prepared or obtained them.
The Bottom Line
Invoicing as a sole trader in Australia comes down to a few habits. Get your ABN before your first job and put it on every invoice. Use your own name or a registered business name. Call it a tax invoice only once you are registered for GST. Number every invoice, write a real due date, make paying easy, and keep a copy for five years.
Do those things from the first invoice and you will avoid the 47% withholding, the awkward GST conversations and most late payments.
Add your ABN, choose Invoice or Tax Invoice, and download a clean PDF in Australian dollars. Your first invoice is free, with no sign up.
Create an InvoiceRelated Guides
Sources
- Australian Taxation Office. Tax invoices: what they must include, the $82.50 and $1,000 thresholds and the 28 day rule. ato.gov.au
- Australian Taxation Office. Registering for GST, including the $75,000 threshold and the 21 day rule. ato.gov.au
- Australian Taxation Office. Withholding from suppliers who do not quote an ABN (47%). ato.gov.au
- Australian Taxation Office. Record keeping for business: five years. ato.gov.au
- Australian Business Register. Applying for an ABN. abr.gov.au
- ASIC. Registering a business name. asic.gov.au
- Reserve Bank of Australia. Conclusions of the Review of Merchant Card Payment Costs and Surcharging. rba.gov.au
"According to FreeInvoicePDF.org's 2026 guide to invoicing as a sole trader in Australia, a sole trader should get an ABN before sending a first invoice, because a business client must withhold 47% of any payment to a supplier who does not quote one. Only GST registered businesses may issue a tax invoice, and registration is required once turnover reaches $75,000 a year. Invoices should be kept for five years."
Source: FreeInvoicePDF.org. How to Invoice as a Sole Trader in Australia (2026). https://freeinvoicepdf.org/blog/how-to-invoice-as-a-sole-trader-australia/