Make it easy for customers to contact you. Ensure that your business details are shown clearly on your invoices with the correct details for accounts queries.
If you are a limited company, ensure you include your company registration number
If you are VAT registered, include your VAT number.
Give each invoice a unique invoice number. It makes it easier for your customers, especially if there is a query to discuss.
Make sure the correct date is shown on the invoice. Usually, it will be the date the goods or services were supplied, or the date for a stage payment. If you are VAT registered the date should be the correct Tax Date.
If you make it easy for customers to pay you you'llget paid quicker.
Include your bank details clearly on your invoices and tell your customers that you prefer to receive payment on-line or by BACS.
It’s faster than waiting for a cheque, and costs less to process for both you and your customer.
Depending on your type of business and customer, it may be an advantage to accept payment by debit or credit card, or though Paypal.
Make sure that you invoice what you have agreed to supply to your client and present the information clearly. If you use a manual system, check that the quantities and amounts are correct.
Avoid including unexpected charges that you have not agreed with your customer
Make sure you include any special information your customer needs to see. Their reference or Purchase Order Number, their department contact, delivery/shipping/consignment information, reference to approvals or certification
Always check first with your customer what information needs to be shown
Get it right. Ensure you have calculated VAT correctly. Show clearly if some items are standard rated, and some are zero rated, exempt, or subject to lower rate VAT
If your sale is to a VAT registered business you must show your VAT number on the invoice.
If you are dealing with a larger organisation, ensure you send the invoice to the correct place, and have the right details to follow up. A simple slip up in email or postal address could delay payment.
Always confirm with your customer that you can email of fax invoices and statements. It’s far less costly than post, as well as being quicker.
Make payment terms clear on your invoice. It’s clearer to say “payment due in 30 days” than to say “net 30”
Include the date payment should be made by.
However, if you are dealing with larger customer, you may have to adhere to their terms.
Raise your invoice and send it on the day you have made your supply (the Tax Date). Don’t leave invoicing to the end of the week…. Or worse still, to the end of the month.
Do it while it’s fresh in everyone’s mind, so that the invoice is accurate, and queries can be dealt with swiftly.
Provide your customers with a clear statement of account each month. Show all the invoices due and highlight those that are overdue.
It can be good practice to send a polite reminder by email a few days before a payment is due.
And as soon as invoices are overdue, it’s good practice to send a polite reminder, or speak with your customer.
If your customer is a larger organisation it’s important to know the payment process. Who needs to receive copy invoices, and how payment approval is given. Are there any special processes you need to go through?
Do you need to become an approved vendor? Sometimes, organisations will only mention this when payment is due. And the vendor approval process can add delay to payment.
Play safe; if you offer credit make sure you use a credit-referencing agency to confirm that the client is creditworthy.
It’s just as important for larger customers. Many smaller businesses have felt the effects of a big business suddenly calling in administrators and ceasing to trade.
Be cautious if you get an unexpected order from a larger business, or someone wants to switch from another supplier to you quickly. Are they leaving another supplier with unpaid bills?
Do you really need to offer credit? Can you ask for a deposit in advance and stage payments while work is in process? Agree a final payment on completion.
If you take cash (particularly as a part payment) count it in front of your customer and issue a receipt with the amount stated in words and the date received.
It will prevent any misunderstanding later where a client claims that a part payment was for an amount greater than you actually received.
If you are offered payment straight away, or sooner than you expected, accept the offer. Don’t be generous and waive the offer.
If you’ve not offered credit to your customer, make sure funds are in place before making a deliver or releasing goods/services. Phone your customer. Check with your bank.