How to Make an Invoice for Freelance Work
An invoice is a commercial document containing the goods or services a seller delivers to a buyer. It will also include the financial details and the payment terms. A freelancer will submit an invoice to his client for his services.
For a general idea, we can compare an invoice to a receipt we get while shopping from a store. The invoice is a payment request, wherein the receipt is proof of payment.
Why should you always get paid through invoices?
Disputes between freelancers and clients are common these days. A well-written freelance contract combined with an invoice can avoid such situations.
An invoice can be a legal document to resolve a dispute between the freelancer and the client. It can stand to protect the interests of the freelancer.
Sending invoices to clients makes you look more professional. It also helps you keep a better record of your payments. Journaling is the primary intent of invoices.
How to create an invoice as a freelancer?
You can create invoices easily. If you use the help of technology, it becomes even more accessible. Following are a few ways to create invoices easily.
Use an online invoice generator tool
Search for the keyword 'online invoice generator' on Google, and you will get many websites offering free tools. Cazny provides a simple and easy-to-use free invoice generator. You can signup free for Cazny and use it.
Create invoice templates with Google Docs or MS Word
If you prefer classic office software, Google Docs and MS Word are the best options. You can download or create a customized invoice template with them and use it whenever you want to send an invoice.
Ten sections you must include in your invoice
The tax department of the Government provides rules and recommendations. You should check with your respective Government entity to ensure there is anything in place for your region.
There are conventions we should follow while creating an invoice that is applicable across the globe. I have presented them below.
- Business name, logo, and contact information
- Unique invoice number
- The due date for payment
- Client's name and contact information
- Description and cost of individual services provided
- Amount due(if any)
- Amount totals with taxes (if applicable) and breakdown
- Issue date of invoice
- Preferred method of payment
- Terms and conditions
I have ordered these sections in a widespread invoice format. Yet, their position might be different in various templates.
1. Business name, logo, and contact information
Your business name should appear at the top of your freelance invoice. If If you use any logo, it should appear at the top-left side of the invoice. That is the hotspot and an excellent opportunity to cement your branding. The address and contact information of the sender should appear right after the name.
2. Unique invoice number
Assigning your invoice a unique number is a must. It not only helps you to keep better track of your invoices but also helps your clients to manage their invoices. The invoice number should be a running serial number. Combining your name initials with a 4-digit number can be a good invoice number. Every time you want to send a new invoice, increment the number by 1.
3. The due date for payment
All invoices have a due date. It would be best to mention the due dates next to the invoice number. Following are the general due date practices. You should follow the one that you agree with your client.
- Net 15 - Due in 15 days from the date of invoice.
- Net 30 - Due in 30 days from the date of invoice.
- Net 45 - Due in 45 days from the date of invoice.
- Net 60 - Due in 60 days from the date of invoice.
- Due on receipt - Due when your client receives the invoice.
4. Client's name and contact information
The invoice should also contain the receiver's name and address, as stated in the contract. It would be best if you mentioned the client's official name. This section should appear after the due date and invoice number.
5. Description and cost of individual services provided
The most crucial section of an invoice is here. It is a tabular section where a short description, number of units, rates, and amounts of individual service(s) that the freelancer has provided to the client.
If your invoice demands advance payment, mention that in this section.
6. Amount due (if any)
If any previous invoices are due, you should include them in this section. It reminds the client of payment.
7. Amount totals with taxes (if applicable) and breakdown
This section appears right after the tabular section under the due date. It presents the total payable amount or sum of all services plus the due amount with a tax breakdown. If there are any discounts provided, you should mention them here.
8. Issue date of invoice
It is the date on which you issue the invoice. It would help if you gave it under the amount totals section on the bottom left side of the invoice.
9. Preferred method of payment
Traditionally this section used to contain the sender's bank details. You can include your online transaction details, for example, PayPal or an online payment link. It is a good practice to mention more than one payment method.
10. Terms and conditions
The final section should contain any terms or conditions related to the work or the invoice. For example, if there are any late payment fees, then mention them in this section.
11. Authority signature of seal (optional)
You can sign your invoice or attest with a stamp. Signing an invoice is not a mandatory requirement.
Sending invoices for advance payment
As a freelancer, you can also send invoices for advance payment. It would be best to mention the advance charges in the individual services section. Mention related terms and conditions in the final part of the invoice.
When do you send an invoice?
Immediately after you complete the project, send an invoice to the client. Never hesitate to send an invoice and ask for payment. If a project is long duration, you should send an invoice on a weekly or monthly basis.
Please do not make it a surprise event. The client should be well aware that you will send an invoice.
You should agree on when to send the invoice during the freelance contract stage. For example, is sending an invoice based on duration or milestone completion? Before you send the invoice, inform the client via your established communication channel. Then ask for his approval, and then ship it after his approval.
How to send an invoice?
You should send invoices via email as it helps to keep a better track and makes you look more professional. Some freelancers also send invoices via WhatsApp or social media is not recommended.
Businesses always use invoices to request payment from their clients. As a freelancer, you must send invoices to your clients. Not only do they make you look more professional, but they also work as a payment reminder for your client.