October 29, 2020 Invoicing en_US One of the most important documents your company will create is an invoice. Learn what to include in your invoice. https://quickbooks.intuit.com/cas/dam/IMAGE/A4LEzWKAd/reporting-invoicing-article-1.jpg https://quickbooks.intuit.com/r/invoicing/components/ What to include in an invoice
Invoicing

What to include in an invoice

By Ritika Puri October 29, 2020
One of the most important documents your company will create is an invoice. Think of it as your comprehensive accounting paper trail—the details 2 parties need to do business with one another. Before getting into what makes up an invoice, it’s important to understand the basics of invoicing.
An invoice is a bill between a buyer and a seller indicating what was sold, and how much is owed. They’re used for account-based transactions between vendors and sellers who work with each other on a regular basis. You can use invoices to track how much your customers owe you and monitor your cash flow.
Invoices are like most bills—they’re issued from a vendor to a customer for something they’ve already received, something in development, or something that’s ready to be created. But unlike a restaurant bill, invoices aren’t necessarily immediately due. You can give customers the flexibility to manage their cash by setting invoice payment terms, also known as due dates, up to 3 months.
When creating an invoice, make sure you always include the following:
  • Header: The word INVOICE should be in large letters, centered across the top of the page. This helps you indicate to your busy customers—who need to filter through many documents on a daily basis—that they need to make a payment.
  • Payer’s name and address: List the company or person that is issuing the payment, along with the mailing address. This information helps your customers understand that the document is intended for them.
  • Payee’s name and address: List the name of the person or company being paid, along with the mailing address (the payee’s email address will also suffice). This information makes it easier for your customers to send you a check.
  • Itemized list of goods or services: Depending on the type of work that is being billed, list a description of the work that was completed. For example, if the invoice is for a particular product, list the product name, quantity, per-unit price, and total price in columns that run vertically on the page. Itemized details are especially important for both you and your customers’ accounting documentation.
    If the invoice is for services, list the name of the project, a brief description of the type of work (graphic design, writing) and the hourly or flat rate. If you listed an hourly rate, the number of hours worked should be included. If payment is per piece, separately list each completed assignment.
    An invoice total should be clearly marked underneath the listing of products and services being billed to avoid any undue confusion.
  • Purchase order numbers: Make sure you include customer purchase order numbers or billing codes if applicable.
  • Date: It’s important to include the date the invoice was issued, as well as the date(s) the work was completed and when the products were ordered or delivered. You can discuss this preference with your client and/or business to make processing easier for both of you.
  • Invoice number: An invoice number is not generally required, but it may help in keeping you organized. Larger organizations often have complicated billing systems that may require a certain invoice number or code.
  • Terms: Note the payment terms to ensure timely payments. Whether the payer or the payee, it’s important that everyone has an expectation of when the payment is due. Most invoices have a 30-day term, meaning you have 30 days to pay after receiving an invoice or you’ll be hit with late fees or penalties. This is usually written as “Net 30” on the invoice. It can also help to write the due date on the invoice.
  • Penalties: Make sure customers know there’s a penalty for late payments.
  • Payment options: Make it clear which payment methods you accept. If you don’t accept credit cards or PayPal, or prefer an ACH transfer to your bank account, note that on your invoice.
When you provide the right information, you’ll avoid redundant paperwork and decrease unpaid invoices. To save even more time, use accounting software that makes the invoicing process simple. You can track time, expenses, invoice payments, even employee payroll, on one app.
Just want to create a free invoice? Try QuickBook’s invoice generator and invoice template library.
If you’re looking to manage invoices, QuickBooks invoicing software also offers these additional benefits:
  • Get paid faster when you accept credit cards and Apple Pay via online payments.
  • A mobile app lets you send invoices and accept payments on the go.
  • Get automated sales tax calculations on your invoices.
  • Automate follow up with automatic payment reminders so you can get paid by the due date on your invoice.
  • Set up recurring invoices and save time.
With QuickBooks, you can spend less time on accounting and more time doing the things you love.
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