Definition of Tax Invoice
A legal document issued by a registered dealer (seller) on the event of a sale, to another registered dealer (purchaser), who is not the consumer, is known as a tax invoice. The invoice should be created in triplicate i.e. original for the buyer and the rest two are retained by the seller.
Tax invoice plays a significant role in any country’s tax system as the dealers issue invoices, for recognizing a transaction. At the end of the financial year, they had to submit the details of these invoices to the relevant tax authorities. So, this is an important tool used by the government to avoid tax evasion.