What must a distributor's sales tax invoice contain, including the CNIC or NTN of an unregistered buyer?

A sales tax invoice is the document on which both sides of a sale rely. The supplier records output tax from it, and the buyer can only claim input tax if it holds one. Section 23 of the Sales Tax Act, 1990 fixes what goes on it, and section 8 attaches a cost to leaving out one particular item for unregistered distributors.

What particulars does section 23 require?

Section 23(1) requires a registered person making a supply to issue a serially numbered tax invoice at the time of supply of goods, in Urdu or English, containing these particulars:

Clause	Particular
(a)	Name, address and registration number of the supplier
(b)	Name, address and registration number of the recipient, and for supplies by a manufacturer or importer to an unregistered distributor, the NIC or NTN of that distributor
(c)	Date of issue of invoice
(d)	Description and quantity of goods (with count, denier and construction for textile yarn and fabric)
(e)	Value exclusive of tax
(f)	Amount of sales tax
(g)	Value inclusive of tax

The provisos and later subsections add further rules:

• One invoice per supply. Not more than one tax invoice shall be issued for a taxable supply.
• Modified invoices. The Board may notify modified invoices for different persons or classes of persons.
• e-Bilty linkage. Added by the Finance Act, 2025: where goods are transported or supplied, the registered person must ensure the tax invoice is generated and linked with the e-Bilty generated under section 40C. Section 40C(4) applies section 83C of the Customs Act, 1969 with necessary changes; the detailed e-Bilty procedure is not set out in the text held here.
• Who may issue. Section 23(2) says no one other than a registered person or a person paying retail tax may issue an invoice under this section.
• Electronic invoicing. Sections 23(3) to (6) let the Board require electronic invoices, prescribe how invoices are issued and authenticated, and require integration with the Board’s computerised system for real-time reporting.

What changed in 2026?

The Finance Act, 2026 substituted the opening words of section 23(1). They now refer to a registered person making “a taxable as well as exempt supply” issuing a tax invoice, including an advance receipt invoice, “bearing a verifiable and unique FBR invoice number”. A proviso says that number requirement applies from the time the Board notifies, and another lets the Board notify who may issue advance receipt invoices. The consolidated text still carries the older words “supply shall issue a serially numbered tax invoice” after the new expression, so the sentence reads awkwardly. This page does not try to resolve that drafting.

How does the NIC or NTN rule affect input tax?

Section 8(1)(m) bars input tax on “the input goods or services attributable to supplies made to un-registered distributor, on pro-rata basis, for which sale invoices do not bear the NIC number or NTN as the case may be, of the recipient as stipulated in section 23.”

In plain terms, if part of a registered person’s sales goes to unregistered distributors on invoices without their NIC or NTN, a matching proportion of that person’s own input tax is disallowed. The Act does not set out the pro-rata formula.

There is a gap worth knowing. Section 23(1)(b) names the NIC or NTN requirement only “in case of supplies by manufacturer or importer to unregistered distributor”. Section 8(1)(m) is not limited to manufacturers or importers. The text does not state directly whether a distributor that neither makes nor imports goods, selling to an unregistered sub-distributor, must show the NIC or NTN. Recording it removes the question.

Worked example (illustrative figures)

Al-Madina Distributors, registered in Karachi, supplies 200 lengths of electrical conduit pipe at Rs. 900 each to a registered retailer in Hyderabad. The quantities and prices are invented. Assume the goods are taxed at the standard rate of eighteen per cent under section 3(1) and fall under no special schedule.

1. Value exclusive of tax: 200 x Rs. 900 = Rs. 180,000.
2. Sales tax: Rs. 180,000 x 18 / 100 = Rs. 32,400.
3. Value inclusive of tax: Rs. 180,000 + Rs. 32,400 = Rs. 212,400.

The invoice carries a serial number, Al-Madina’s name, address and registration number, the retailer’s name, address and registration number, the date, “conduit pipe, 200 lengths”, and the three amounts above. Because the goods travel by truck, the invoice is linked to the e-Bilty.

If the same load went to an unregistered sub-distributor, the invoice would also carry that buyer’s NIC or NTN, and section 3(1A) further tax would come into play; see the related page on further tax.

Common mistakes

• Leaving out the recipient’s details on wholesale sales. Clause (b) applies to every tax invoice. The Explanation after clause (b) defines “ordinary consumer”, but that term no longer appears in the substituted clause (b).
• Issuing a second invoice to correct the first. The second proviso forbids more than one invoice per taxable supply.
• Assuming the buyer’s input tax is safe on any paper invoice. Section 7(2)(i) requires the buyer to hold a tax invoice in its name and bearing its registration number.

What to check in the official text

Read sections 7, 8, 23 and 40C of the Sales Tax Act, 1990 as amended to 30 June 2026. Board notifications on modified invoices, electronic invoicing, the start date for the unique FBR invoice number, and the e-Bilty procedure under section 83C of the Customs Act, 1969 are not part of the text held here.