Your company issues a sales invoice to your client to receive payment for goods or services. An invoice is a legal document which must be recorded by law.
(It is not the same as a receipt, which is an acknowledgement of payment).
An invoice must clearly display the word ‘invoice’ and contain the following details:
- Invoice date
- Unique invoice number / reference (sequential numbering with a prefix is commonly used)
- Company’s name, registration number and contact details
- Company’s Registered Office address
- Company’s VAT registration number (if VAT registered)
- Client’s name and address
- A clear description of the charge – i.e. time of supply, description, amount/s being charged, VAT amount/s if applicable, total owing, etc
- The payment terms
If your company is VAT registered and invoices for expenses, you should add VAT to the expenses (even if the expense did not have VAT). Your client may ask you to not charge VAT on top of expenses which include VAT, however legally this is not the case.
If you require assistance with the correct treatment of VAT on expenses, please feel free to refer to our detailed expenses guidelines in our Tax Toolbox or contact your First Freelance accountant for support.
Self-Billing arrangements: Some clients may operate what is known as a ‘self-billing’ arrangement. This is an arrangement whereby your client generates an invoice on your company’s behalf and sends you a copy and payment. You should not issue another invoice to them (by law). You should still however ensure the invoice is recorded in your own company accounts.
First Freelance provide the following services to our clients:
- Invoicing support services (including credit control)