Use a unique sequential number for every invoice (no duplicates, no gaps). The format itself doesn't matter much — INV-001, INV-2026-001, or 20260501-001 all work. The two rules that DO matter: never reuse a number, and never have gaps in the sequence. This guide covers common formats, year-based vs continuous numbering, prefixes, what to do when an invoice is cancelled, and country-specific tax compliance requirements.
In most jurisdictions, yes — sequential numbering is required by tax authorities for VAT/GST-registered businesses. The UK, EU, Canada, and Australia all require sequential numbering.
Document why. If you cancelled an invoice, keep the cancelled one on file with a 'VOID' watermark. Auditors look for unexplained gaps.
Yes — there are no rules requiring a specific format. ACME-001 or JONES-PROJ-2-001 all work as long as they're unique and sequential within their own scheme.
Personal preference, both are valid. Restart-yearly (INV-2026-001) is cleaner for organising by tax year. Continuous numbering is simpler.
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