Margin scheme VAT invoice: what it must show

A margin scheme VAT invoice shows the total price and must not show VAT separately (official guidance). That one line is where most shops go wrong, and it is the paperwork side of the VAT margin scheme: the arithmetic can be right and the sale can still fall outside the scheme because the invoice said the wrong thing.

GOV.UK is explicit that "the margin scheme invoice requirements are not the same as the general VAT invoice requirements" (official guidance).

What a margin scheme invoice must not show

The VAT. The total price goes on the invoice, and "you must not show VAT separately" (official guidance). The VAT you owe on the margin is worked out in your own records, not printed for the buyer.

What goes on it

When you sell an item under the scheme, the invoice you give the buyer must include (official guidance):

• the date;
• your name, address and VAT registration number;
• the buyer's name and address, or that of their business;
• the item's unique stockbook number;
• the invoice number;
• a description of the item;
• the total price, with no VAT shown separately;
• one of the scheme statements, which for used devices is "margin scheme - second hand goods".

Margin scheme invoice example

A used phone sold for £240 that cost the shop £180:

On the invoice	In the shop's stockbook
Date, invoice number, your details and VAT number	Stock number, date of purchase, purchase price £180
Buyer's name and address	Name of seller, description of the item
"Used smartphone, stock number 1042"	Date of sale, sales invoice number
Total: £240.00	Margin: £60.00 · VAT due: £10.00
"Margin scheme - second hand goods"

The £10.00 lives in the right-hand column only. The stockbook fields are the ones GOV.UK lists for each item bought and sold (official guidance). The figures are worked in how to calculate margin scheme VAT, or put your own through the margin calculator.

Why the till gets this wrong

A till set to print a VAT breakdown on every receipt will print one on a margin-scheme sale too, and that document is then wrong. It is worth looking at what your receipt actually says on a used-device sale rather than assuming.

Buying records: the other half

The scheme also needs an invoice from the seller for every item you buy. It includes the date, the seller's and your names and addresses, a description of the item and the total price, "you must not add any other costs to this price"; where you bought from another VAT-registered business it also carries the item's stockbook number and the scheme statement (official guidance). Which items qualify at all is in when does the margin scheme apply.

Where SlickCell fits

Second-hand stock can be taxed on the margin between what you paid for that unit and what you sold it for, reported separately from standard-rated sales. Because every device carries its own purchase cost, the per-item record the margin scheme asks for is already there. See how used-device stock is costed per unit.

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General information, not tax advice. Check the published guidance or speak to your accountant. Rules on this page were checked against the published guidance on 25 September 2026.