Invoicing Checklist: How to Create an Invoice Correctly

Invoicing Checklist

If you have been working with your clients for some time now, you are definitely familiar with the term “invoice.” Moreover, you also probably know that this document helps you get paid for the job you are doing and that it must be flawlessly made if you don’t want any misunderstanding or errors.

However, making a proper invoice may sometimes be easier said than done.

So, before you create one next time, make sure you read through this article and get an ultimate invoicing checklist example with all the steps of the process included! And that’s not even all—we’ll also show you how to make an invoice with our online generator to avoid hassle!

Why is Invoicing Important?

When it comes to the importance of invoicing, the answer is simple. These documents record each and every transaction between you and the people who buy your products or services. This makes them a crucial part of your business paperwork.

Besides that, invoices let you track your payments easily and check the details of your projects and payment terms without getting lost in the sea of other documents.

Invoicing is also important because of the tax obligation you have as a business owner. Businesses are usually required to issue invoices, which helps them organize their paperwork and gather required documentation and information more easily when tax time comes around.

4 Different Types of Invoices

Next, it’s key to get familiar with the different types of invoices you may need if you work with clients. Here are some of them:

  • Digital invoice. This type of invoice is usually created and delivered electronically, in PDF or Word format.

  • Recurring invoice. This is a repeated invoice that you can send to a client if they keep paying you for the same product or service.

  • Deposit invoice. This type of invoice helps you request a portion of the agreed-upon payment from your client in advance before you provide them with the product or service.

  • Freelance invoice. As its name suggests, an invoice like this is the best option for freelancers who want to request payment for the projects from their clients.

How to Prepare for Creating Invoices

Prepare for Creating Invoices

Before we start reviewing our invoicing checklist, let’s see what you need to do before you start creating an invoice.

#1. Set Pay Rates

First things first, you need to decide how you will set up your pay rate. For example, you can choose to charge your clients at a(n):

  1. Flat rate, which means that you set a fixed price for the product or service you’re offering, regardless of how much time you spent working on a specific project.
  2. Hourly rate, which implies that you set up an hourly price for your work and later multiply it by the exact number of hours you spent working on a specific task or project.

#2. Define Billable Work

The next thing you want to include in your invoicing checklist is billable work.

Here are some parts of your work that are considered billable:

  • The activities you’ve conducted during a project
  • The communication process with the clients
  • Any type of revision or extra hours you have spent working on a project

On the other hand, non-billable work may include:

  • Any type of vacation leave
  • Sick leave
  • Holiday leave
  • Personal time off
  • Training new recruits
  • Checking emails
  • Suggesting ideas

Although these types of tasks are also connected to the business, they don’t form part of your invoice.

#3. Define the Billing Period

The billing period represents the time frame between two payment statements and generally lasts between 20 and 45 days. Of course, its length depends on various factors, including the specific goods or services you will be rendering to a client.

For example, the billing period is usually considered short if it lasts less than 30 days or longer if the time between your payment statements is anywhere between 30 to 45 days. It’s best to consider your needs and business requirements in order to come up with the best solution and include it in your invoicing checklist.

#4. Decide on Payment Terms/Methods

Deciding which payment methods you will approve is one of the crucial steps of the process. Usually, the most recommended ones are:

  1. Direct bank transfer
  2. Third-party payment providers (like Paypal)
  3. Cash
  4. Cheques
  5. Credit cards

To find out what works best for you, you should always:

  • Review the types of payment methods
  • Check each method’s credibility
  • Ask your customers if they agree to this payment method
  • Check the costs of each method

Free Invoice Checklist

Free Invoice Checklist

Now, let’s see what details you should include in your invoice to make it professional.

#1. Invoice Design

Choosing a suitable and neat invoice design is important for various reasons. Not only does this feature add a professional tone to your document, but it also makes you look more credible in your customers’ eyes.

Moreover, if your invoice looks like any other, it can easily get lost in the sea of other similar documents. But if it stands out, you can rest assured that the client won’t forget about it or accidentally discard it.

#2. Invoice Date

Next, it’s important to state when the invoice is being sent and for what period the payment is being issued. Note that you shouldn’t confuse this date with the date when the services or goods were provided to the client.

#3. Invoice Number

Your document should also include a unique invoice number. It’s a code you assign to an invoice so that you can find it among other similar documents more easily. This number also helps you mark the document for accounting or tax purposes.

#4. Your Company Information

To enable your client to reach out to you if they have any questions or dilemmas, you should also include a company information section to your invoice. It should be clear who is requesting the payment, which means that you need to disclose the following pieces of information:

  • Your full name
  • Email address
  • Home address
  • Phone number

#5. Client Information

The next step is to disclose your client’s contact details, which are usually stated similarly to yours. Provide their business name (or a personal one, if they don’t have a company), their phone number and email address, as well as their home address.

#6. Services/Products Items

To properly list your services or products on an invoice, you should:

  • Provide a description of the services or goods
  • Mention the number of hours you’ve spent working on providing the services or goods to the client (if necessary)
  • List the payment rate for each particular service or product
  • Add the total payment rate of each service or product combined

#7. Total Cost

A total cost section is a mandatory part of your invoice. It showcases every addition and reduction to the pay rate, including additional working hours and tax reductions.

#8. Payment Terms

In order to properly list the payment terms on your invoice, you should make sure to mention:

  • How frequently the payment should be received (weekly, biweekly, monthly, etc.)
  • What time frame the payment period includes
  • When the payment will be issued

How to Send an Invoice

Once your invoice is ready, you can decide whether you want to send it via:

  1. Email. Looking fora quick and easy way to send an invoice to your client? If yes, you should email it to them. All you have to do here is make sure that the document is converted to PDF and mention that you are sending an invoice in the “Subject” field of the email.
  2. Mail. If the person you're sending an invoice to is not a fan of online communication, you can send your invoice via mail. One thing to keep in mind here is that this is usually a lengthy process, which is why it usually isn’t recommended.
  3. Online invoicing software. This is one of the safest ways for your invoice to reach the client. You can create the document and send them a link to it without having to attach it to an email or wait for the physical copy to reach them.

How to Follow up on Late Invoices

How to Follow up on Late Invoices

Once you’ve come near the end of your invoicing checklist, the last step of this whole process is to make sure that you get paid on time. If by any chance that doesn’t happen, you can send a follow-up email to the client and politely ask them when you can expect the payment to be processed.

Usually, it’s recommended to send a follow-up email if the payment hasn’t arrived one week after the invoice is handed to the client. Still, it’s crucial to stay positive and keep a friendly tone when you send it.

If you send a follow-up email and don’t receive a response in a week, send another one after two weeks. In case this waiting time exceeds one month, you can try a different approach by mentioning that the payment is taking longer than expected and that you were wondering if there’s an issue that needs to be discussed.

Final Thoughts

If you were struggling to find answers on how to properly create and use an invoice, we hope that our guide and the invoicing checklist helped you find them!

Even though invoices can be hard to tackle in the beginning, creating an invoice checklist and using our templates will surely help you with your troubles. Using our online invoice generator is simple because the process is quick, and the software gives you a step-by-step guide to help you throughout the whole process.

We can also help you create other important documents, which is why we offer templates for W-2 forms, 1099 forms, and pay stubs.

Key Takeaways

  • An invoice is a billing document that you, a seller of a specific product or service, send to your client in order to get paid.
  • Invoicing is important because it allows you to look out after your incoming and outgoing payments and organize your paperwork better.
  • There are many different types of invoices that are used for different purposes, including credit invoices, digital invoices, recurring invoices, standard invoices, deposit invoices, and more.
  • It’s a good idea to go through a comprehensive invoicing checklist before sending invoices, as it helps you make sure that your document includes everything it needs.


Your email address will not be published.

* Required filled