When you work as a freelancer, it might take a while for you to get used to the throughout of having to handle your own invoices and chase up payments if they don’t come on time.
Freelancing is a great line of work because it allows you to work from anywhere without an issue and it takes the stress off you with travel and gives you the freedom to work when you can. The issue comes when you start to look at finances. When you take into account tax returns, electrical bills at home and all the other things you need to run your work, it can mount up pretty quickly. This is why it is crucial that you make sure your invoices always get paid on time by the customer.
You could use invoice factoring to manage your invoices for you, but if you want to do the invoicing yourself, you'll need to learn what makes an up a successful invoice. Remember, an invoice is essentially a contract of payment, so you need to make sure that you get it right and don’t miss anything off it.
What needs to be on an invoice?
If you have never made your own invoice before, you might be forgiven for thinking that you simply write down the price for the work and the clients details. It's not that easy!
Here are other elements which also need to be added on to the invoice to make it work for your purpose:
- The clients order number if they have purchased a product
- The clients job number for work
- The name of the project or product which was purchased by the client
- Details about the work completed, including hours worked if needed
- The total sum which needs to be paid to you by the client
- Your payment terms- you can add a deadline here if you like
- You bank details or Paypal info so that they can transfer you the money over
- Your client's name and address
- Your name and address
- Invoice number and date
- VAT registration number
- Registered business number and address
- Contact information
How to chase up your invoice
When it comes to chasing up the payment of your invoices you might feel a little uncomfortable. Don’t worry, it is totally normal for you to feel a little weird about demanding money from your client, but just bear in mind that you need the money to finance your business and your life. Plus, you did the damn work, so you deserve it!
If you have several freelance jobs going on at once, it would be helpful for you to create a calendar with reminders on when certain payments are due. If the due date comes and the invoice has not been paid, you will need to contact your customer to find out what is going on.
It could be that they simply forgot, or they have another reason for not paying you. Send a gentle reminder and a copy of the invoice in an email. I've found that sometimes it helps to send a notice to a client's boss in the company to get things moving.
If they refuse to pay, you can get the law involved since you sent them an invoice with a payment agreement on it. Send them a certified letter stating that you intend to take them to small claims court if they don't pay by a certain day. Typically, clients will get scared into action.