In one line
A document that asks a client for payment for work already delivered.
Also called a bill, a sales invoice, or a tax invoice where tax is shown.
What it means in practice
An invoice records who billed whom, for what, how much, and by when. It is a commercial and accounting record rather than a government form, so it is valid on its contents rather than its format.
The parts that matter: your details and the client's, a unique number, the issue and due dates, the work as separate lines, the tax if you charge it, the total, and how to pay.
Covered in full in the guide to make an invoice.
Example. Quote first, invoice when the work is done, receipt when the money arrives.
Where it shows up on the paperwork
The word Invoice at the top, your details and the client's, a unique number, the issue and due dates, the work as lines, the totals, and how to pay. Everything else is optional.
What goes wrong
- Sending it to the person who hired you rather than the person who pays.
- Leaving off the client's PO number when they use one, which is the most common reason an invoice stalls.
- Describing a week of work as one line called services rendered.
The tools for this
Related terms
- ReceiptProof that a payment was made, issued after the money arrives.
- QuoteA fixed price you are offering for named work, held open until a stated date.
- Invoice numberThe unique reference that identifies one invoice, running in sequence with no repeats.
- Form W-9The IRS form a US client asks you to complete so they can report what they pay you.
- Itemised invoiceAn invoice that lists the work as separate lines with quantities and rates rather than one total.
- Purchase orderA document you issue to a supplier that commits to buying named goods at named prices.
Common questions
Is it legal to write my own invoice?
Yes. An invoice is a document you issue, not a government form. It is valid on its contents: who billed whom, for what, when, how much, and the tax if you charge it.
What is the difference between an invoice and a bill?
The same document from two sides. You issue an invoice; your client receives a bill.
Do I need software to send invoices?
No. A PDF made in the browser is as valid as one from an accounting package. Software helps when you are tracking many invoices at once, not when you are making one.