Freelancers' Questions: How to keep track of all my invoices?

Freelancer’s Question: What is the best invoice format that works for both freelancers and clients, and what should my invoice template include? Plus, in terms of a numbering system for my invoices, how should I set about it once the new tax year (April 6th) commences?

If I create invoice No. 1, No. 2 and so on, should I start on April 6th again from No. 1, No. 2 etc? Or is it better to start #2015/001, #2015/002 for example, continuing until December 2015. My aim is to keep my invoices very organised, under control and easy to track.

Expert’s Answer: Staying organised and keeping your invoicing under control is a good idea and we commend you for considering all angles, but you may be overcomplicating the numbering issue slightly. As long as you can track your invoices by the numbers they have, you shouldn’t have a problem and nor should your clients.

You could use any of the examples you put forward and not encounter any problems. I personally prefer to use the year at the start of the invoice number if given a choice, with this changing with a new (calendar) year. But it is entirely up to you and what you find easiest to organise you should select.

Invoice numbers will make little difference to your accountant, as the dates of the transactions themselves are all they need to keep your accounts tidy. As for clients, well most of them will look at an invoice just twice -- once when it is received and again when they have to pay it!

On the subject of getting paid, don’t forget that your invoices must include certain information by law and it’s usually a good idea to include some other details, specifically:

  • ‘Invoice’ (Your invoice must have the word 'invoice' on it; you’d be surprised how often this is overlooked)
  • Invoice number
  • The name and address of the customer
  • Your business name and contact details
  • Total amount being charged
  • Date of supply
  • Date of invoice (if different to the date of supply)
  • Date payment due
  • A clear description of the goods/services supplied
  • The costs of the goods/services provided
  • VAT and at what rate (if applicable)
  • Total amount being charged (gross and net)
  • Your bank or payment details (vital!)

In addition to the above, you have further legal requirements in relation to your legal trading status. If you are using a limited company or LLP, you must include:

  • The full legal name of the company as it is registered
  • The company number
  • The registered office.

If you are a sole trader or partnership, you must include

  • Your name
  • The business/trading name
  • An address that you can accept the service of legal documents; ordinarily your trading or accountants address.

If you aren’t planning on using an online or automated invoicing system, then you can get some free basic templates at the Microsoft Office website that make a good starting point.

The one final point for you to consider (if you haven’t already) is in relation to VAT registration. That’s because if the company is VAT-registered, then certain legislative and legal hoops must be adhered to in relation to invoice numbers and necessary details. The government’s website has further information in the event that this applies to you.

The expert was Adam Home, a manager at Safe Collections, a debt recovery agency that specialises in serving freelancers and the self-employed. 

Editor’s Note: Related Reading –

Freelancers’ Questions: Should I agree to change my invoice?

Top 10 excuses for not paying invoices

Freelancer’s client told to negotiate over inflated invoice 


Mar 10, 2015
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