Sales tax invoices mandatory on advance payments

The Federal Board of Revenue has made sales tax invoices compulsory for registered taxpayers receiving advance payments for future supplies, Dawn reported on November 6. Under procedures issued through SRO2063 of 2026, output tax must be reported in the return for the period when the payment arrives.

A separate invoice is required for each instalment paid towards one supply, with invoices electronically connected to provide a transaction trail. When goods or services are eventually supplied, a final invoice must refer to those receipts, while tax already reported on advances is excluded from repeat taxation. Advance amounts face the rate in force when received, and any unpaid balance is taxed at the rate applicable at supply; adjustments are also prescribed for refunds, cancellations and changes in value.