Easily Create an Invoice Template

by Emily Retherford

4 min read

Accurate and timely invoicing is an essential element of your business. If you don’t submit invoices for your services, you won’t get paid. If your invoices are unclear or inaccurate, your payments may be delayed and you can lose professional credibility. Setting up a reliable, streamlined system is vital to ensure money keeps coming into your business.

Heading of the Invoice

Writing the word “Invoice” at the top of the page makes it easily identifiable and helps the document stand out from the rest of the mail.

You want to number each invoice using a system that works for you and allows you to easily track past and current invoices. Some businesses simply begin by allocating number 000001 to their first invoice and continue in consecutive number order. Others prefer to add a code to identify each client. For example, James Baker’s first invoice might be JB00001, Jayne Brown might be JYB00001, and so on.

Set your business name, address, post code, phone, email, and website address in a letter-style block format and add your Business Number, also known as your GST Registration Number. That way, your client has everything to facilitate prompt payment or to contact you with any queries.

Include your client’s name, address, post code, and Business Number for your own records, and to make sure your invoice reaches the correct destination.

Add the date you prepared the invoice and the date payment is due. Allow for a sensible timeframe when choosing invoice payment terms. To state “payable on receipt” is not user-friendly and can cause problems as you have no way of knowing for sure when your client will actually receive or see the invoice.

Body of the Invoice

You want to be clear about what you are charging your client and why. At this stage, there should be no surprises. Prior to commencing work, you have already agreed to an hourly rate and the number of hours for the services. If you need to exceed the agreed-upon budget, make sure your client is aware and in accord.

List a brief description of the services you supplied along with dates and hours worked. Don’t forget to add any incidental expenses you might have incurred on behalf of your client, such as fees or postage, or essential purchases.

Display the amount due as a subtotal before taxes, add any relevant taxes, and show the total sum due on the invoice.

A Brief Note About Taxes

A small business’ tax situation varies from province to province, and different rules relate to the Goods and Services Tax, Harmonized Sales Tax, and Provincial Sales Tax. The Canada Revenue Agency website has plenty of advice on taxes for small businesses and also offers an online GST/HST calculator to help you calculate how much to charge. Your invoice must clarify exactly how much tax you are charging your clients as they need this evidence to support their claims for input tax credits/rebates for the GST/HST. It also helps you keep clear and accurate records as you are required to hold this tax in trust until you send it to the CRA.

If your business revenue before expenses over the previous four calendar years amounts to a relatively small sum, $30,000 or less as of April 2017, you do not have to register for or charge GST/HST. Even so, you might choose to register to claim input tax credits. If your business is based in a province that charges GST and PST, you might qualify for a provincial small supplier exception. Consider consulting provincial tax information bulletins for up-to-date information.

Payment Information

Beneath the total sum due, indicate your preferred payment method to make it easy for your clients to pay you promptly. Include banking information, the name that should appear on any cheque, or alternative methods.

Consider adding a note about any additional terms and conditions such as discounts for prompt payment or penalties for late payment. A polite reminder that “prompt payment is appreciated” often helps speed up the process, as does thanking your clients for their business.

If you send your invoice through the post, some clients appreciate a cut-off slip with your name, address, invoice number, and amount due so they can use this to slip in the envelope with a cheque.

Reminders

An effective invoicing system helps you quickly identify clients who have not paid by your deadline. Don’t assume the worse; if they were unhappy with your work, they would most likely tell you. In busy times, it’s easy to let the admin slip, so send out a friendly, personalized email or text reminder with a duplicate invoice in case the original was lost. If the invoice remains unpaid, give the client a call.

Paper vs. Digital

If you are committed to keeping your office as paper-free as possible, you can choose to keep the whole process digital by creating invoices online and emailing them to clients as attachments. This saves the need to organize mountains of paperwork and avoids the risk of your invoice getting lost in the post. There are numerous software packages designed to ease the process of invoicing. You can customize these to your specific requirements and add your logo. Some let you create and send from mobile devices; this is handy for invoicing on the go. Others sync with your accounting software and update your books automatically as you issue each invoice or mark it paid.

Whatever method you choose, setting up an easy-to-use invoice template and a robust file system lets you keep on top of your admin and projects a professional image. It also helps ensure you get paid in a timely fashion and maintain the cash flow that is essential for your small business’ survival.

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