In the world of self-employment and freelancing, managing your finances is a crucial part of the job. Being a large or small business owner is a big deal. One essential aspect of this is sending out invoices to your clients for the work you’ve completed. Invoices help you get paid for your hard work and ensure that both you and your clients are on the same page regarding payments.
If you’re new to self-employment or freelancing or just need a refresher on how to create a self-employed or freelance invoice, you’re in the right place. In this blog post, we’ll walk you through the process in easy-to-understand language, covering everything from what information to include to how to send your invoice.
Step 1: Gather Your Information
Before you start creating your invoice, you’ll need to gather some essential information. Below is the information which you will be required to give:
Your Address and Contact Information: Include your full name, address, email address, and phone number. This makes it easy for your clients to reach you if they have any questions or concerns.
Client’s Contact Details: Include your client’s name, their company name (if applicable), address, email address, and phone number. This ensures that your invoice reaches the right person and department.
Invoice Number: Assign a unique number to each invoice. This helps you keep track of your invoices and makes it easier to reference them later.
Invoice Date: Include the date when you’re creating the invoice. This is the date you send it to your client.
Due Date: Specify when you expect to receive payment. It’s common to set the due date 15-30 days from the invoice date, but you can adjust this based on your agreement with the client.
Step 2: Describe Your Work
Next, you’ll need to detail the work you’ve completed. Below are three points that should help you do this seamlessly.
Itemised List: Create a list of the services or products you’ve provided. Be specific and use clear descriptions. Include the quantity, unit price, and total price for each item.
Hours Worked: If you charge by the hour, mention the number of hours worked, your hourly rate, and the total amount for each task or project.
Subtotal: Calculate the subtotal by summing up all the individual item prices or hourly rates.
Step 3: Add Taxes and Discounts
Depending on your location and the nature of your work, you may need to include taxes on your invoice. Check your local tax regulations to determine if you should charge sales tax or any other applicable taxes.
Additionally, if you’re offering any discounts to your clients, make sure to subtract them from the subtotal at this stage.
Step 4: Total Amount Due
Calculate the total amount your client needs to pay by adding the subtotal and any applicable taxes or fees. This is the final amount your client should pay you, so make sure it is visible on the invoice.
Step 5: Payment Instructions
Clearly specify how you want to be paid. Provide your bank account information if you accept direct bank transfers, or include your PayPal or other payment service details. Make it as easy as possible for your client to make a payment.
Step 6: Terms and Conditions
Include any payment terms and conditions that you and your client have agreed upon. This may include details on late payment fees, payment methods, and the consequences of non-payment. Keep this section concise but informative.
Step 7: Review and Proofread
Before sending the invoice, double-check all the information for accuracy. Ensure that the client’s details are correct, the math is correct, and your payment instructions are clear. A professional, error-free invoice reflects positively on you and can help you get paid promptly.
Step 8: Send the Invoice
You’ve done it! Your invoice is ready to go. Send it to your client via email or through whatever method you’ve agreed upon. Make sure to keep a record of the invoice for your own records. They will come in handy at the end of the tax year in the need for tax rebates. The sooner you organise your administrative tasks, the better.
Step 9: Follow Up
After sending the invoice, it’s a good practice to follow up with your client to confirm they’ve received it and to remind them of the due date. A polite and friendly reminder can help ensure timely payments.
LJS Accounting Services Can Help!
As a business owner, your day is probably already tight for time but administrative tasks like invoicing cannot be forgotten about. By following these simple steps you can effectively manage your finances and stay on top!
Remember that clear and professional invoices not only help you get paid on time but also build trust with your clients, which can lead to more business in the future. So, get those invoices out there and keep your self-employed and freelance journey on the right track!
If you’re struggling to balance all of your other duties, seeking help from accounting experts like LJS Accounting Services can ease some of the stress. This will also give you more time to focus on other areas of your business that you enjoy.
At LJS Accounting Solutions, we have over 10 years of experience in this complex field and have won multiple awards for our services. What can we say, we just love what we do!
Contact us today by calling 0151 601 0000 or emailing firstname.lastname@example.org for more information. Let us handle your bookkeeping and ensure that your invoices are paid, managed, and stored in the most efficient way possible. Our friendly team looks forward to assisting with your personal tax needs.