Invoice requirements: What should be mentioned on an invoice?
If your company is involved in the supply of goods or services, you probably use invoicing to get paid for your work. An invoice is an extremely important document for business as it provides a guarantee for the seller and the customer that the terms of the transaction will be followed. To avoid any invoicing mistakes, make sure your documentation contains all of the points mentioned below.
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While it is quite an obvious thing, nevertheless you should never forget to label all invoices at the top of the page, noting the exact name of the document. Make invoices look more sophisticated by adding the logo of the company to the header. Keep in mind: details matter.
2. Invoice Date
Specify the date which corresponds to the actual time of the transaction. This way, you will easily structure your papers and categories invoices in chronological order. Including the day of the transaction is vital, as it serves as proof for the date of the deal in any confusing situations.
3. Invoice Number and Unique Identifier
A common rule for all invoicing is specifying the unique number for the invoice (or the unique identifier). This identifier can match the order number or be generated as a unique number of the company. Sometimes, invoice requires more specific details and company information, for example, internal purchase order (PO) numbers or billing codes. Therefore, do not forget to check all specifications beforehand to avoid mistakes.
4. Your Company’s Information
Invoice is an official document, which means that it should contain the legal name of your company, as well as its address, phone and fax numbers. These details help to keep things simple and distinguish between the payer and payee in some specific cases.
5. List of Goods and Services
The central part of the invoice is a list of your items or services. It is essentially the “body” of the document. In this section, you should include the details of the items or services, such as name, price, quantity, etc. You can also expand this list with adding other details about your products or services.
6. Terms of the Transaction
Another principal part of the invoice is the terms of the transaction. Payment conditions depend on the type of your business and the kind of products/services you offer. Trade terms are all about the transferral of ownership right and risk liability. In international trade incoterms are widely used. It is a set of the contract terms used to define the responsibilities of sellers and buyers for the delivery of goods under sales contracts. The terms may include penalties for paying late or not paying in full.
7. Fees or Taxes
Sometimes you might need to include taxes or fees in the invoice. If you are applying taxes to your clients, add them to any item or task that is taxable.
8. Total Amount Due
What else is important to add to the invoice is the total amount due. The total amount to be paid will help your customers make transactions easily.
9. Due Date
The due date must be included in the invoice alongside the list of goods or services and total amount due. The due date will help keep the invoice history organized and get you the payments in time.
This point is not an obligatory one. But you can add extra elements to your invoice whenever necessary. It can be a message field to say “thank you” to the client or a field to note other essential details. Sometimes, companies file invoices with Tax Identification Number (TIN).
While there are no exact or legal standards for making invoices, you can follow these ten points above to create professional invoices for your customers.
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