The Complete Guide To Creating & Sending An Invoice

That Gets Paid

Invoicing is a crucial part of running a business. Without invoices, you wouldn't be able to accept payments for the goods and services you sell.

But it's not uncommon for businesses to experience delayed or rejected payments due to an error on an invoice or flaws in their invoicing process.

That's why we created this guide. To help you create professional invoices to request payment. We'll go through how to fill in an invoice, as well as how to send an invoice, so you avoid making simple mistakes.

What is an invoice? 

Before starting to create an invoice, it's important to first understand what it is. 

An invoice is a financial instrument that details the goods or services provided in a business transaction. It includes details of work performed and costs associated with the services or goods, along with personal and/or business information related to both parties in a transaction.

It is an important document for businesses to request payment from a customer/client and also acts as proof of the exchange.

With that in mind, we are ready to go through the steps to create an invoice template that can be easily modified to suit your business. 

How to create an invoice? 

Prior to the tech boom, invoices were manually written out by hand. Now, there are various ways to make invoices. Many businesses use Microsoft Word, Microsoft Excel spreadsheets, and invoice templates available online to create invoices from scratch or from a limited set of pre-installed templates.

To create an invoice, you’ll need to break your invoice up into at least four to five sections.

This can change from industry to industry, or business to business, but generally, by breaking up an invoice like this, you are able to incorporate all the required information in a clear and concise manner. 

how to make an invoice

1. The invoice header

The header of an invoice is at the top of the document.

Some information that is commonly included in this section is the invoice date, a business logo, and the most important feature, the term “Invoice.”

Another key detail that can be added here is the unique invoice identification number or order number if you are supplying goods. 

How to create an invoice identification number?

There are many techniques to format an invoice identification number. Most companies will use a combination of letters and numbers. Let’s look at some examples you can use. 

 

You can order each invoice number sequentially 

For example INV0001, INV0002, INV0003.

 

You can include a unique customer code

One method is simply abbreviating the name of the company. For example, if you were to invoice Statrys, you could format your invoice number like STAT0001, STAT0002.

 

You can intertwine the date and invoice number

You can incorporate the date the invoice is issued at the start of the invoice number.

For example, you could format this like 20220914-0001 or 2022-09-0001. If you want, you can also include a customer code as well, this will distinguish invoices more easily when using this technique. 

Ultimately, how you format the invoice identification number, and the other details in the header section is up to you.

  • Just make sure each invoice is standardized.
  • Having standardized features help with organizing and storing invoices. 
  • Check that the correct invoice date is updated each time you create a new invoice. This will save you from any confusion if you need to look up invoices. 

If you want to learn more about invoice numbers and how to use them correctly, be sure to check out our comprehensive article on the subject.

2. Business or personal details of transacting parties

This section will include all the details related to you, your business, and the company or individual you are invoicing.

To request payment from a company, you will need some information from them. Most companies are willing to provide this information as long as you inform them of your intentions as part of the business transaction.

Some of the important details that should be included in this section include:

  • Company names 
  • Tax identifier number or business number 
  • Company address details
  • Business Contact information including email and phone number

Some of these details can vary from being voluntarily provided to mandatory depending on the country of invoice.

Specifically, the tax identification number or business/company number. If local laws mandate sales or service tax collection from businesses, then this must be provided.

For example: 

3. Invoice details: a table with a list of services or goods provided

The table section of an invoice is where you are going to break down exactly what you are seeking payment for.

This could be for services provided or goods supplied. Generally, the table will be broken down into three or four columns.

Ensure that the information in this section is updated to reflect the work or goods that payment is being requested for.

Simple mistakes of amount mismatches and incorrect descriptions can reflect poorly on your business.   

4. Payment details 

This next section includes all the payment details that you need to provide to enable the customer to facilitate payment. 

There are two overarching payment method types, an international or global payment, and a country-specific or internal transfer. 

Payment methods

1) Global payment method or international transfer 

When you need to make a cross-border transfer, you can choose from various international payment methods.

Types and details that are commonly provided include: 

Some countries are bound by strict local tax regulations for making and receiving international payments for commercial services or goods provided. This may impact which international payment method you choose to get paid. 

Be aware that different international payment methods can incur different fees for a transfer to be facilitated or accepted. 

2) Country-specific or internal transfer 

When you invoice companies/individuals from your home country, you can provide local bank account details or payment methods unique to that country.

For instance,

  • In Hong Kong, you can simply include your HK bank account number together with your name.
  • If you are invoicing in Australia, then the company account holder's name, BSB number, and account number details need to be provided for a local transfer. 

There are many accepted payment methods available now, with unique corresponding details attached to each.

Preferences can depend on either transacting party and are usually stipulated within the payment terms of the invoice. 

Payment terms

Finally, when it comes to payment, be sure to clearly outline what you expect so there aren't any misunderstandings. Some details to consider here are foreign currency exchanges, a due date for payment, and penalties for late payments. 

1) Foreign currency exchange terms

If you require to be paid in a specific currency, then this must be specified in the payment terms.

Currency exchange rates are volatile and constantly changing, so if your payment requires a currency conversion, the amount can differ depending on the actual confirmed transaction date. 

2) The due date for payment

Although it is not mandatory to provide a due date for payment, it can help alleviate the chance of delayed payment.

Some common time frames that you will commonly see for payment requests are within or by 14, 30, 60, or even 90-day allowance.  

3) Penalties for late payments

If your company has specific payment deadlines or schedules to meet, that can be considered as penalties for late payments.

It can be in the form of an administration fee for follow-ups for late payments, or interest incurred after a certain timeframe for any delayed payment. 

Tip: Having clear expectations is a great way to keep everyone involved in a transaction accountable and organized.  

How to send an invoice? 

Now that you’ve created and filled in your invoice, you are ready to send off your invoice to its desired destination, so you can get paid for your work or the goods that have been provided.

Here are some things to consider before sending off an invoice.

1. Standardized the file name: Standardized file names create an organized system, so you can easily look up an invoice if a payment is delayed or rejected. Make sure you check this matches with each invoice you are saving.

2. The PDF file: an invoice should be in a file format that cannot be edited or changed by the receiving entity, or anyone that may receive it.

3. The recipient: The invoice should be directed to a specific person or department. 

4. The way the invoice is sent: You’ll need to ask if the invoice needs to be sent by email, by post, or even via online invoicing.

Now you know how to create, fill out and send a professional invoice…

With all this in mind, you should now have a pretty good idea of what it takes to create an invoice, how to fill out an invoice, and things to consider before you send an invoice off for your services or products.

By following this guide, you’ll have a great invoice template that you’ll be able to modify and make your own. 

If you want to get to it, you can try our free online invoice generator.

FAQs

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