The ultimate goal for every business is to make more sales, and generate profits. It is crucial to organise the sales related administration and make you customers feel comfortable while receiving your products, invoices, and making payment to you.
In order to receive timely payment, an invoice should be raised promptly. Therefore when raising an invoice the following essential points should be considered.
- Invoice – all invoices should be clearly marked with the word “Invoice”, or “Commercial Invoice”. It will help to avoid confusion between Pro-forma Invoice, Purchase Order, Credit Note, or another similar document.
- Name and address – most of your customers would have a number of suppliers, so the name and the contact details of your business should be clearly stated.
- Company Registered Address and Number – if your business is a limited company, the registered address and the company registration number have to be written on the invoice. You will need to show the formal registered name of the company, alongside any name which you are using to trade.
- VAT number – if you are VAT registered business, stating your VAT number should help your customer administration.
- Customer name and contact details – the name and the contact details of the recipient should be clearly listed on the invoice. Hence it would help avoiding any misunderstanding. If an invoice is related to a particular person, it is advisable to include his name. As a result it will speed reaching the right person and approving the invoice for payment.
- An invoice reference – the invoice reference have to be unique, hence that would help your business as well as your customers’. Keeping an accurate record will help you avoid duplications.
- Purchase Order – if your customer has sent you a purchase order, listing it on the invoice face would help him matching the purchase order and your invoice, and consecutively making punctual payment.
- Date – the date the goods or services are provided. Above all, date is extremely important for VAT invoices. Therefore using accurate date will help you to maintain submit correct VAT Returns.
- Details – information describing the goods or services provided will always be beneficial for organising, disputing, or paying invoices. Thus the correct unit price and quantities will help avoiding disputes and delayed payments.
- Price – clear unit and total prices should be stated. If trading internationally, clarifying the payment currency could be very useful.
- VAT amount – if you are VAT registered and the tax is applicable it should be clearly declared on the invoice along with the VAT rate. If the invoice is exempt, zero rated, or VAT is charged just on part of the listed goods, it should be clearly acknowledged too.
- Discounts – if there any discounts applicable (eg. if invoice is paid within 10 days of receipt) this should be descriptively written on the invoice.
- Payment terms – payment terms should be visibly listed on the invoice. Certainly, the terms may vary depending on your type of business and trading relations.
- Payment instructions – it is in your interest to state clearly what payment method you prefer BACS/Cheque etc.
- If you expect customers to make a direct payment to your bank account, you should list the following information:
Your Business Name
Your Bank Name
Invoices represent the identity of your business. Raising clear and neat documents that contain all relevant information will make you look professional. If you have a company logo it is a good practice to place it on the invoice. The logo might help you developing your branding and create good association amongst existing and potential customers. Additional information like a website, or branch address, or extra service might benefit the development of your business. Might be a good practice to create your invoice template, so every time when an invoice has to be raised you use the template and create similar documents with consecutive references.
For your guidance we have enclosed two samples. Basic invoice template and VAT invoice template.
Finally, we can invoice your clients on your behalf. We would even create a free invoice template for your business.