How to Invoice as a Freelancer

One of the luxuries of being an employee is the guarantee you’ll get your paycheck every two weeks, come rain or shine. When you’re a freelancer, you have liberties that employees don’t, but the burden of making sure you get paid is on you.

Because of this, how you invoice as a freelancer has a significant impact on your cash flow. Here’s what you should know to optimize the process, including everything that should go on your invoices as well as when and how to send them.

What to include on your invoice

Invoices are more than just the way you collect payment for your freelance work. They’re official documents with tax, accounting, and potentially even legal implications on them.

As a result, you should make sure your freelance invoicing system is consistent, professional, and organized. To that end, here’s everything you should consider including on each one.

An invoice number

First and foremost, every freelancer invoice should include a unique number that you can use to identify it. There are dozens of reasons why you might need to track down or refer to a specific one, including:

• Following up with clients to secure late payment on an unpaid invoice.
• Investigating discrepancies in your financial statements.
• Supporting transaction details for your tax records in an audit.

Feel free to use any numbering system that works for you. Some freelancers take a simple approach, making their first invoice number 1001 and counting upward from there for all their clients.

If you like to keep things a little more organized, you could use a system that distinguishes between different clients. For example, Client A’s invoices might start at 1001, while Client B’s invoices begin at 2001.

Your contact info

Next to the actual transaction details, your contact information is one of the most important things to include on your invoices. It serves several different purposes, including:

• Identifying yourself so that the client knows who the bill is coming from.
• Letting your client know the best way to reach you for disputes or questions.
• Providing your address for tax purposes, such as 1099-NEC issuance.

At the very least, your contact information section should include your name, the name of your small business, your email, and your mailing address. If you’re comfortable with or prefer communicating over the phone, you can include your phone number too.

The client’s contact info

It might seem redundant to include your client’s contact information on your invoices, but it’s a good practice. It confirms the intended recipient for both you and the client you’re invoicing.

In addition, if you have to go back and review your invoices for accounting or tax purposes, you can see who you billed on the document itself. Otherwise, you might have to search your invoice software history or outgoing emails to confirm the recipient.

Feel free to include as much information about your client as you have. Just like your own contact information section, that will probably include the client’s name, business name, email, and mailing address.

Due date

Unsurprisingly, the payment due date is another piece of information you should always include prominently on your invoices. In fact, it might even be a good idea to put it in more than once to make sure your client doesn’t miss it.

For example, you might want to put the due date at the very top of the invoice so your client can see the due date just by glancing at the email, then again at the bottom with the grand total.

That way they can receive the invoice and note the due date even if they don’t have time to review and pay it just then.

Date of invoicing

In addition to the due date, make sure to include the date you complete and share the invoice with your client. It’ll help document the sequence of events for future reference.

For example, if your client pays Invoice 1001 late, they might ask you to share the next one further in advance of the due date. If you do so and they still pay late, having the invoice date on the document makes it easy to prove you kept your word.

Services charged for

A self-employed invoice should contain a clear explanation of everything you’re billing the client for, which typically includes the following:

• Brief descriptions of each product or service
• The number of units sold
• The price per unit

When you’re invoicing clients for multiple projects, products, or services, it’s usually best to split them into different line items. For example, if you’re a website designer, you might differentiate between the hours you spent on each webpage.

In some cases, your client may want you to describe your product or services in a way that aligns with their project tracking. Consider asking whether or not they have any preferences in this area. 

Payment terms

In addition to the due date, you may want to state payment terms to give the client more insight into your invoicing timeline. For example, you might include that your invoice is net-30 to confirm that payment is due in 30 days.

That becomes especially important if you want to offer a discount for early payment or charge a late fee. Listing those terms on your invoices encourages timeliness or, at least, helps prevent disputes that may arise if you add a late penalty without warning.

Payment options

Every invoice should include an explanation of the ways you’re willing to accept payment for the amount, such as credit card, debit card, or ACH transfer.

Note that the more options you can offer your clients, the better. They’re much more likely to pay you on time when they can do so in the manner that’s most convenient for them.

Total amount due including taxes

Last but not least, make sure you prominently display the grand total your client owes you, including taxes if the transaction warrants it. Generally, that only applies to the sale of goods.

If you’re creating the invoice manually instead of using an invoicing tool for help, make sure you review the final tally. Confirm that the previous line items and subtotals all add up to the correct amount.

You never want to accidentally over or undercharge your client. Going back and revising an invoice you already sent to a client is unprofessional at best and a major headache at worst, especially if they’ve already completed it.

A sample invoicing template

As they say, a picture is worth a thousand words. Take the freelance invoice template below as an example of how you may want yours to look.

Notice that it’s not anything incredibly fancy, and yours doesn’t have to be either. A simple invoice will do the job. It just has to be professional and organize the relevant information as clearly as possible.

When and how to send an invoice

Building a professional invoice template is only half the battle of getting paid as a freelancer. You also have to get the document to your client at the right time and through the proper channels.

Let’s address the best time to send your invoices first. There are many different lines of thinking in this area, and each approach has its pros and cons. Some popular schedules include the following:

• After each project and before the next one begins
• Every two weeks on specific days of the month, such as the 15th and 30th
• Every month on the 5th for the previous month’s work

In general, invoicing more often is better for you as a freelancer, while invoicing less often will usually be preferable to the client. Some freelancers even require partial payment upfront to ensure no one takes advantage of them.

You have to find a balance that makes sense for both parties given your freelance business model. Consider offering your clients a couple of options that work for you and letting them choose.

Next, let’s take a look at the best ways to send your invoices. In this day and age, there are really only two viable options. You can send the invoice to the client directly from your invoicing software dashboard or email it to them manually.

If you’re using invoicing software, you can usually use either option. Sending through the dashboard is often the default, but you should also be able to copy a link to the payment page and email it to your client.

Of course, if you’re creating your invoices manually in a document or spreadsheet, you’ll have no choice but to email them. Make sure you save the invoice as a PDF before sending it so the client can’t edit it accidentally or on purpose.

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_{Information provided on this blog is for educational purposes only, and is not intended to be business, legal, tax, or accounting advice. The views and opinions expressed in this blog are those of the authors and do not necessarily reflect the official policy or position of Lendio. While Lendio strives to keep its content up-to-date, it is only accurate as of the date posted. Offers or trends may expire, or may no longer be relevant.}