How to Make an Invoice

What is an invoice, and how do invoices work?

An invoice is a payment request you send after delivering goods or services. It records what was delivered, what the client owes, and when payment is due. It is not a receipt (which confirms payment already happened) and not a quote (which proposes pricing before the work).

The flow is simple: you issue the invoice, the client — or their accounts payable team — checks it against the agreed price or purchase order, and pays by the due date. Your job is to make that check easy: complete details, clear line items, and an unambiguous total. Beyond getting you paid, invoices are the paper trail behind your revenue: they support your tax filings, back you up in a dispute, and tell you at a glance who owes you what.

How to write an invoice in 7 steps

1. Label the document “Invoice.” It sounds obvious, but a document that doesn’t say what it is gets set aside. The label also tells the client’s bookkeeping where to route it. (In some countries the wording is regulated — Australia requires “Tax Invoice” on GST invoices, for example. See requirements by country.)
2. Add your business details. Your name or company name, address, email, and phone number. A logo helps the client recognize you at a glance.
3. Add your client’s details. The company name, billing address, and the person who actually handles payment. For larger clients, ask for the accounts payable contact — invoicing the wrong person is one of the most common causes of late payment.
4. Assign an invoice number and dates. Use a unique, sequential number (INV-0042, then INV-0043), the issue date, and a due date. If you deliver goods, some jurisdictions also want the supply date — the date you actually delivered, which can differ from the date you invoiced.
5. List line items. One line item per product or service, each with a description, quantity, and rate. Be specific: “Homepage redesign — 12 hours @ $90/hr” gets approved faster than “Design work.”
6. Add tax, discounts, and the total. Show the subtotal, then the tax rate and tax amount if you collect tax, then any discount or shipping, then the total due. The client should never have to do math to know what to pay.
7. State payment terms and methods. When payment is due, how to pay (bank transfer details, check, or whatever you accept), and your late-fee policy if you have one. A one-line thank-you note at the bottom costs nothing and keeps the relationship warm.

Every field in these steps is in the Invoice Generator: fill them in, preview the invoice, and download the PDF. If you want a starting layout instead, use the Invoice Template.

Example: a finished invoice with the math shown

Here is what those seven steps produce for a small design studio billing a bakery client. Notice how each line item names the deliverable, the discount is applied before tax, and the due date is written out — not left as “Net 14” for the client to calculate.

What to include on an invoice: checklist

Many countries require extras beyond this core — tax IDs, specific wording, or sequential numbering rules. Keep the core fields constant and add what your jurisdiction requires on top.

Invoice number formats that scale

Any format works as long as every number is unique and you never reuse or delete one — a gap in the sequence reads as a missing invoice in an audit. Three systems cover almost everyone:

One habit worth stealing from freelancers: start at 1001 instead of 0001. The sequence works exactly the same, and your first client doesn’t learn they’re your first client.

5 ways to make an invoice, compared

There’s no single right tool — there’s a right tool for how often you invoice and how much layout control you want. The honest comparison:

Our own bias is obvious, so here’s the honest version: if you send a few invoices a month, a free generator does the job and the math. Once you’re sending dozens and reconciling payments against a bank feed, accounting software earns its subscription. If you take the spreadsheet route, this 12-minute tutorial walks through building the layout and formulas in Excel:

Types of invoices and when to use each

Most businesses only ever need the standard invoice. The rest exist for specific moments in a sale — and using the right one avoids confusing the client’s bookkeeping:

Invoice payment terms: Net 30, due dates, and late fees

Payment terms state when the money is due. Net 30 is the B2B convention, not a law — nothing stops you from Net 14, and for small businesses the shorter term is usually the right call:

• Write the actual due date, not just the term. “Due April 14 (Net 30)” removes the date math and the excuse.
• If you charge late fees, say so on the invoice itself — “1.5% per month on overdue balances” is a common formulation where local law allows it. A stated policy is usually enough; most clients pay to avoid the conversation.

How to send an invoice (and follow up)

The standard way to send an invoice is a PDF attached to a short email — send it the day you finish the work, while it’s freshest in the client’s mind. If you use cloud mode, you can also share invoices from your History with the send feature. Here’s an email you can copy:

Then follow a fixed reminder cadence instead of deciding case by case: a friendly note a few days before the due date, a reminder on the due date with the payment instructions repeated, and an overdue notice 7 days later. The overdue note stays short and factual:

What to do when an invoice isn’t paid

Escalate in stages, and assume good faith at the start — the large majority of late payments are oversights, lost emails, or slow approval chains, not refusals:

1. 1 week overdue: the short factual email above, invoice re-attached.
2. 2 weeks overdue: pick up the phone. A two-minute call unsticks more invoices than three more emails — you usually learn exactly where it’s stuck (“waiting on a director’s approval”) and can ask for a specific payment date.
3. 3–4 weeks overdue: pause any ongoing work for that client, apply the late fee if your terms state one, and send a statement of account listing everything outstanding.
4. Beyond that: a formal demand letter often works on its own. After that, the options are small claims court (limits range from a few thousand dollars to $25,000 depending on the state), a collections agency (expect to give up a large cut), or writing it off. Which is worth it depends on the amount and whether you ever want the client back.

The best fixes are upstream: a deposit before work starts, the AP contact confirmed on day one, and the invoice sent the day of delivery.

VAT, GST, and sales tax on invoices

Tax treatment depends on where you operate and what you sell, but the presentation rules are universal: decide whether your prices are net or gross and stay consistent, show the tax rate and the computed tax amount as separate lines, and keep the records behind your filings. For quick math, use the VAT Calculator or the Sales Tax Calculator. For cross-border work, confirm the currency, tax treatment, and reverse-charge rules before you invoice.

One trend worth knowing about: structured e-invoicing is becoming mandatory for B2B sales in a growing list of countries, especially in the EU — Italy already requires it and several other member states have mandates in force or scheduled. A PDF is still fine almost everywhere else, but if you sell into Europe, check the rules for each country you invoice.

Invoice requirements by country

The core fields in the checklist are universal. What varies is the extra layer each jurisdiction adds:

If you invoice with VAT or GST regularly, start from the VAT Invoice Template or the GST Invoice Template so the extra fields are already in place.

How long to keep invoices

Longer than you’d think. In the US, the IRS baseline is three years, stretching to six if substantial income went unreported; the UK and Australia expect five to six years. The practical policy is simpler than the rules: keep every invoice PDF you issue, forever — they cost nothing to store, and the year you need one is never the year you expected to. Cloud-mode users get this automatically via History; if you generate PDFs locally, give them a folder per tax year.

Quotes, proforma invoices, and final invoices

These three documents mark stages of the same sale. A quote proposes pricing before any commitment. A proforma invoice gives the buyer a formal pre-approval document with full line-item detail — common in B2B procurement and cross-border shipping. The final invoice is issued after delivery and is what goes into accounts receivable. Mixing them up causes rework: a client who approved a “proforma” may be surprised by a final invoice that differs, so keep the numbers consistent from one stage to the next. If you need the middle document, start from the Proforma Invoice Template.