What should I include on my invoice? 6 Tips to help you raise your invoices correctly.

A question my contacts get asked a lot is “What should I include on my invoice?”

Common sense will cover off most things and I’m sure you will all know most of this already, so I’m going to break this up into 7 sections:

  • What you must have

  • What you must have if your a sole trader

  • What you must have if you are a limited company

  • What you must have if your VAT Registered

  • What you should have

  • Do something different

So most people believe they know what details an invoice should include. However do they really?

You must include:

  • Invoice numbers that are unique
  • Invoice date is the date you raise the invoice

  • The company name and address of the company you are invoicing

  • Your company name, address and contact information

  • Any descriptions on your invoice must mean something to your customer, not you.

For example, Item description “XP2889F” may be fine for you but your customer might ring up and order “Branded Pens with a metal clip”. So putting XP2889F on their invoice would lead to confusion over what goods you were charging for.

  • The date the goods and services were delivered

  • The amount being charged

For Sole Traders, your invoices must also include:

  • Your name and any business name you are using

  • An address where legal documents can be delivered to if you are using a business name

For Limited Company invoices, you must also include:

  • Your full company name as it appears on your certificate of incorporation

  • If you put a directors name on the invoice, you must list all the directors

Note as a limited company, your company registration number does not have to appear on an invoice.

If you are VAT registered then you will also need to:

  • Ensure your unique invoice numbers follow on from the last one (Sequential numbering)

  • Include your VAT number

  • Include the tax point (time you supplied the goods or services which may be different from the invoice date).

  • Include the Total amount excluding VAT

  • Include the Total amount of VAT

  • Include the price per item excluding VAT

  • Include the quantity of each type of item

  • Include the rate of any discounts per item

  • Include the rate of VAT being charged and make sure if exempt or zero rated it is clear you are charging no VAT

  • Include the total amount including VAT

    What else should you have on an invoice?

 

The list above seems quite long and comprehensive, however as well as all the you MUST have, details let’s now think about what you should have.

This is where you need to be in the mindset of your customer, you are trying to make it easy for them to pay, so why not include:

  • Customer references, purchase order number

  • Name of individual placing the ordering

  • The date you expect payment by.

  • What happens if they don’t pay on time

  • Charging for late payment – make it clear to your customer that delayed payment may mean you using “Late Payment of Commercial Debts (Interest) Act 1998”. By putting this on your invoice, your customer can not be surprised when you start charging interest or adding on administration fees.

Do something different.

Use your invoice to make your customer feel valued:

  • Put a web address to a short customer satisfaction survey on your invoice and request they complete it.

  • Include your social media contact details and engage with their responses.

  • Tell them about special offers tied into a service they have already bought.

  • Ask them for a testimonial for your website.

If you provide them with stationery for example, then include a free pen with “Your Details could be here” on it, inside the envelope with your invoice. Why? Well they got a free pen and you have told them about a service you provide that they may not be aware of.

By sending a little extra with the invoice, not only are you raising awareness of other things you do, but you are getting your invoice remembered which will likely lead to quicker payment. You’re giving them something extra they were not expecting and generating a discussion point so other people are more likely to hear about your services and potentially be interested enough to look you up.

What does a simple invoice look like?

Invoice Template

Invoice Template

Now your turn…..

Above I’ve given you my thoughts, not only on what has to be there but also how to help your customer pay your invoice and to get interaction by issuing your invoices.

What do you put on your invoices and why?

How do you get people to engage with you?

I’d love to hear your thoughts.

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