Work Smarter – Not Harder

The Perfect Invoice

Creating the perfect invoice is one of the factors which will help your company to stand out. Whether you have created thousands of them already or are working on your first invoice: Congratulations.

Your work deserves to be paid. But do you know what it needs to create the perfect invoice? A correct invoice in conformance with the law?

Let’s start with the basics. It seems obvious, but – gosh! – you would not believe the things I have seen. An invoice, just as any professional correspondence for that matter, needs a professional heading. With your (or your firm’s) name, your address and if possible a logo (but please: spare me the fancy WordArt creations in neon colors – you’ll be better off without logo…but I will talk to you about that some other time). Let’s stick to the topic: Your invoice needs to state the following.

  • Your address
  • Your client’s address
  • Date of the invoice
  • A unique and continuous invoice number
  • Detailed charges, listing each product or service separately
  • Your Payment Details, i.e. PayPal, Bank Account, …
  • Due date

There you go. But what else do you need to make your invoice legally correct? The answer to this question depends where you work from.

USA

The USA do not have many legal requirements for freelancers’ invoices – but be aware that your client will have to file the yearly payments to you to the IRS who will then contact you to file a form. My advice: Don’t use your SSN on an invoice, you never know where it is going to end and who’s going to see it). Your client might need it once, however, to file his payments correctly.

UK

In the UK, the word ‘invoice’ must clearly be indicated on the document. The following information must also be included:

  • a unique identification number
  • your (company) name, address and contact information
  • company name and address of your client
  • detailed charges
  • the date the goods or service were provided (supply date)
  • date of the invoice
  • the amount(s) being charged
  • VAT amount (if applicable)
  • the total amount owed

Sole traders must include:

  •  the trader’s name or any business name being used
  • an address where any legal documents can be delivered to you if you are using a business name

Switzerland, Austria, Germany

The German speaking countries Switzerland, Austria and Germany have similar requirements – except that there is no legal reason to mention the word ‘invoice’. If the invoicing party is exempt from the VAT (as most freelancers are), they need to explicitly state that they are exempt (e.g. “Kein Ausweis von USt gem. § 19 Abs. 1 UStG” in Germany or “Umsatzsteuerfrei aufgrund der Kleinunternehmerregelung” in Austria).

E-Invoice

The future, or rather the present invoice is electronic. E-Invoices and other forms of electronic billing are replacing invoices on paper. In fact, most of us send their invoice via e-mail, attached as pdf. For a while, those documents required – at least in Europe – a digital signature to make sure they have not been tempered with after the date issued. This process is not legally binding anymore. However, it still is possible to print an invoice, stamp it and keep it in an analogue archive – good and recommended practice for all the sceptics out there.

The Unwritten Rule

There is no law for it – but I cannot stress enough how important an appealing design is. And a friendly word from you to your client accompanied by an appreciative thank you makes invoicing more fun – and the world a better place. If you decide to let me do your invoices, for example, I’ll let you choose from different designs. Of course you can upload your own logo and you’ll have plenty of space to address your client individually and personally.

I hope this blog has been helpful to you and I appreciate your attention!

Invoice & Estimate Invoices


Also Interesting

It’s Tax Time! Filing Taxes the Easy Way

Does tax time make you want to hide? Not anymore. This year will be different: No headaches, no hassle. Instead, you’re totally relaxed. A dream? No. With zistemo filing taxes really is that easy – an online visit from the tax advisor included.

Features Tax

Expense tracking made easy

Are you tracking your business expenses? My guess is: You intend to. When you’ll have the time. Until then, you’re keeping your receipts in a shoebox. Or a drawer. Or are they still filling up your purse?

Expenses Tax

Goodbye Spreadsheet: Why You Don't Need Excel Formulas Anymore

Are you using the spreadsheet as your financial accounting tool of choice? There’s nothing to say against that. Really: It’s reliable (kind of), cheap (relatively), and (once you got the hang of all the formulas and stuff) it’s easy to use.

Business Management Features Freelancer Small Business

What is an invoice?

Are you a new business owner? Did you just get your first order and you need to issue an invoice? Do you really know what is an invoice and what an invoice should include?

Invoice & Estimate Invoices

Skilled Workers: Save time with Cloud Accounting

Craftsmen, manufacturers and mechanics: even the most hands-on skilled trades will benefit from digital invoicing and time tracking apps. Let’s take a tour through the smart zistemo process, and you will see how.

Features Invoice & Estimate Small Business Tax The Future of Work Time Tracking

The Lean Startup Method: 4 Lean Strategies For Your Small Business

Do you really need a business plan? No, you don’t. At least according the Lean Startup method developed by Eric Ries. But beware - that’s only half the truth! Learn more about minimum viable products, agile development and customer-focused evolution - and how to adapt the Lean Startup method to your own small business – even if you’re way past starting out.

Business Business Management Freelancer Small Business The Future of Work

One tool, everything under control

No credit card required. Cancel anytime.