Creating an invoice is a straightforward process that involves including essential information about a transaction. Here's a step-by-step guide on how to create an invoice:
Start by creating a header for your invoice. Include the word "INVOICE" prominently at the top to indicate the purpose of the document.
Add your business name, logo (if applicable), and contact information, including your name, address, phone number, and email.
Assign a unique invoice number to help you keep track of your invoices. This number should be sequential, making it easy to reference in the future.
Include the date the invoice is issued. This is usually the date when you send the invoice to the customer.
Provide your customer's details, including their name, company name (if applicable), billing address, phone number, and email address.
Make sure to specify the payment due date to inform the customer about the deadline for making the payment. This helps ensure timely payment and sets clear expectations.
Create a table with columns for the item description, quantity, unit price, and total price for each product or service provided. Clearly list each item along with its relevant details.
Calculate the total amount for all the items and include it in the invoice.
If its applicable, include any taxes, such as sales tax or VAT, based on your location and the customer's location. Add any additional charges, such as shipping costs or discounts, to provide a comprehensive view of the total amount owed.
Mention the accepted payment methods (e.g. credit card, bank transfer, PayPal) and any specific payment instructions.
If you offer different payment options (e.g., net 30, net 60), clarify the terms to avoid confusion.
Include any relevant terms and conditions, such as refund policies, late payment penalties, or warranty information.
Using an invoice template can help to streamline the process and help maintain consistency in your invoicing procedures.
There are different types of invoice which you could use for different reasons. Here are some common types of invoice:
As a freelancer, how you bill for your time will impact how you write an invoice. For example, depending on whether you bill per hour, or for a project, you may have to specify the time spent on a project. Outline how you charge when you fill in your freelance work invoice template.
To create an invoice for a limited company, ensure that you include: Your full company name, as it appears on your incorporation certificate The full names of the company directors If your limited company is VAT registered, you must issue a VAT invoice.
To create a builder invoice, include in the template the work completed, the time it took, materials and products used throughout the project and any other costs or services.
As a contractor, you could be working in different industries that have different norms for paying an invoice. For example, some industries may pay partly at the beginning of a project, other industries might pay at the end. To create an invoice for contract work, ensure that you specify all the payment terms in the invoice. You should also keep track of all hours worked from the beginning to the end of the contracted project. Specify your hours working in the contract work invoice template to ensure there is no disagreement with your customers.
For a VAT invoice, you need to include the usual details in an invoice, as well as:
The rate of VAT for the goods and services provided
The total amount of VAT chargeable
The VAT registration number of the supplier.
To issue a UK invoice, you’ll need to include the following requirements:
Payment terms on an invoice refer to the conditions the customer needs to meet.
These can include: the date they need to pay the invoice for, any discount for early repayment and any additional charges for late payment.