Updated: Feb 7
What needs to be on an invoice?
Your trading name – the name that your client will recognise as your business.
Your contact details – usually your name, an email address, phone number and physical address.
*Your VAT number – your 9 digit VAT number as well as your country code if you’re invoicing a country overseas.
The client name – the name of the business you’re invoicing.
Invoice date – this needs to be the date you send the invoice so you can’t send an invoice 2 weeks after the invoice date and expect to be paid on time.
Invoice number/reference – it’s essential to have a unique invoice number on every invoice.
Goods or services to be paid for – this might be one line or one hundred but if your invoicing for 3 days and re-billing the travel expenses make sure they are on separate lines.
*VAT due on each invoice item – if you’re VAT registered, you need to show the VAT rate and VAT due for each invoice line
*Total amount of VAT - if you’re VAT registered, you need to show the total VAT due on the invoice.
Total amount to be paid – the total amount due (including and not-including VAT if you’re VAT registered).
Payment terms – clearly state how long after the invoice date you’re expecting payment (this will usually be agreed before starting work for a client)
Your bank details – even if you have a payment link on the invoice, always include the account name, number and sort code
Your company details – if you’re a limited company, you need to include the company name, registered number and registered office.
*only applicable if you are VAT registered
Your logo – this can help someone find your invoice amongst hundreds of others.
A client contact name – sometimes invoices need to be approved so adding your main contacts name to the invoice can help speed up the process.
A payment link – if you’re emailing your invoice you can use software to add a payment link that will allow your client to pay with a credit/debit card there and then (larger clients will rarely accept this as a valid payment method). A detachable payment slip – if you’re posting the invoice you could add a detachable payment slip but this method has become almost redundant with modern businesses.
Invoice on time
Get your invoice out as soon as possible as whether you’re using 7, 14 or 30 day terms, that’s from the date you send the invoice, not the date you did the work. If you’re invoicing monthly, prepare the invoice during the month based on how much work you think you’ll do then on the last working day of the month, there will just be a small amendment to make before sending it.
Keep it simple
It’s sometimes tempting (especially for creatives) to make an elaborate invoice stencil that makes you stand out from the crowd but this will often be detrimental. In reality, the person handling your invoice is unlikely to have any influence in the business and will be inputting vast quantities of data from piles of invoices so just want to find the key information quickly.
Don’t let your invoice number be an issue
Never re-use invoice numbers (even when sending an amended invoice) and try to avoid invoicing with very simple references like INV001, INV002… There’s a chance this could create issues in your client’s systems so maybe use something related to your business name like FOC-001, FOC-002.
Get the layout right
If you’re working with a large company, there’s likely to be a person or team that deal with invoices for 40 hours a week so they intuitively look for your details in the top right corner, the total amount to be paid towards the bottom of the page on the right and the payment details somewhere near the bottom of the page. Don’t be tempted to veer away from these practices as it just increases the chance of errors.
Send it to the right person
Nobody wants your invoice to be paid as much as you do so don’t rely on others to pass on your invoice. In most businesses, there will be one person responsible for processing invoices so try to get direct contact details for that person and develop an active and friendly business relationship with this person if possible. They might be able to tell you specific days when they will be doing a pay run or it could help them understand that you’re a small business that needs the money on time.
Different types of invoice
Sales invoice – if you send an invoice to a client that you want them to pay, then it’s a sales invoice.
Tax or VAT invoice – sales invoices that include VAT are sometimes called tax or VAT invoices.
Interim invoice – if you’re invoicing on a project basis you might send an invoice prior to completion as a deposit or just to cover costs. This would be an interim invoice.
Final invoice – again, a final invoice occurs when you’re invoicing for a project rather than for a period of time. A final invoice is sent after the project is complete and takes into account any interim invoices that might have already been paid towards this project.
Recurring invoice – if you’ve agreed a set charge that will repeat (perhaps if you’re on retainer) you’d send a recurring invoice.
Pro forma invoice – these are rare in non-trading businesses as they are usually used to show the price of goods prior to an actual sale.
Credit note – This is a reversed sales invoice that is often used to cancel an invoice that has already been issued.