It is usually made up of information that helps to identify who you are invoicing and what they will get in return for the work you have done. The body lists what was done under various headers and related costs, while the end lists your contact information. Elaborate on options like PayPal or bank transfers so clients fully comprehend next steps for smoothly paying your invoice. No matter what type of freelance work you do, it’s imperative that you keep track of your invoices and make sure that you’re receiving payments for your work. Depending on the services you provide, your clients may be responsible for paying taxes. You’ll not usually have to register for VAT when you first start invoicing clients as a UK freelancer.
This makes the customer more likely to choose your services for future projects as well. These are based on the type of service you provide and the charging pattern you follow. Understanding the difficulty of being paid on time, filing taxes, and remaining legally employed, Native Teams developed a platform that allows you to perform all of these tasks from one platform. It is essential to choose the business structure that best meets your goals and conditions. Consider the nature of your firm, the level of risk involved, and your own personal financial status. Seeking guidance from an expert, such as an accountant or lawyer, can help you determine the ideal business structure for your company.
What should an invoice include?
To maintain the freedom and independence you love, you need to maintain a steady cash flow. In other words, keep the work coming in- and invoicing for it promptly. Moreover, you can auto-dispatch recurring invoices with an app like Xolo Go to save heaps of time on billing. Read more about financial how to invoice as a freelancer management best practices for freelancers. The above details are sufficient in most jurisdictions, but you should always double-check with a local authority if you’re in doubt. You can use a free late payment interest calculator from the EU commission to model different penalty scenarios.
According to the government’s article on Charging Interest and Debt Recovery on Late Commercial Payments, the type of interest you can charge in this scenario is called ‘statutory interest’. If you still do not receive payment after the timescale stated in your letter, you may choose to take the company to the Small Claims Court. If you do decide to take them to court, it’s wise to look into how much this would cost and work out whether or not it would be worth it for the amount that you are owed.
How to Invoice as a Freelancer in the UK
If you already have several clients with rigid Net 30+ terms, make sure your newest ones either pay a project advance or can accommodate a “due upon receipt” clause. This way you’ll always have some cash on hand to power through the waiting periods. You will only need to collect VAT from clients in the same zip code as your business. So if you’re using the Xolo Go invoicing app or run an e-Residency company via Xolo Leap, you only have to collect VAT when invoicing other Estonian business entities or private persons.