How to write an invoice

An invoice is a request for payment that records what you delivered, how much is owed and by when. A good one leaves no room for confusion, which is the single biggest reason invoices get paid on time. You do not need special software to write one. Below is the universal checklist, then the specific legal requirements in the UK, the EU and the United States, plus numbering, payment terms and how long to keep the paperwork. You can put it all together in the free invoice generator.

What do you have to put on an invoice?

These fields appear on essentially every invoice, in every country. Get these right and you have a document a client can approve, an accountant can file and a bank transfer can reference.

How do you write an invoice step by step?

1. Head the document. Write Invoice at the top, then your name or business name, address and contact details.
2. Assign the next number in your series. Take the next number in one unbroken sequence, do not pick one at random.
3. Add the client. Full legal name and address of the business you are billing, plus a contact person and their purchase order reference if they use one.
4. Put both dates on it. The issue date, and the date the work was delivered or completed if that is different.
5. List the work as line items. One line per deliverable, with a description specific enough that the client can approve it without asking you a question. For hourly work, hours go in the quantity field and your rate in the rate field.
6. Total it up. Subtotal, then any discount, then tax at the applicable rate on its own line, then the amount due.
7. State the terms. The due date in plain words (for example, due 30 days from the invoice date), your bank or payment details, and the reference the client should use.
8. Save and send it. Send a PDF rather than an editable file, and keep your own copy for your records.

The free invoice generator lays out all eight steps as fields, does the arithmetic and gives you a watermark-free PDF, and it runs entirely in your browser so your rates and client details never leave your device.

What must legally appear on an invoice in the UK?

GOV.UK sets out the minimum for an invoice issued in the UK. Every invoice must include a unique identification number, your company name, address and contact information, the company name and address of the customer you are invoicing, a clear description of what you are charging for, the date the goods or service were provided (the supply date), the date of the invoice, the amounts being charged, the VAT amount if applicable, and the total amount owed.

What changes for a sole trader versus a limited company?

This is the part that trips up new freelancers. Under the same GOV.UK guidance, a sole trader must also show their own name and any business name being used, and if they trade under a business name, an address where legal documents can be delivered. A limited company must use the full company name exactly as it appears on the certificate of incorporation, and if it chooses to name any of its directors on the invoice, it has to name all of them. Both rules exist so that the customer can identify and, if necessary, serve documents on the actual legal entity behind the invoice.

What extra does a UK VAT invoice need?

If you are VAT registered and you are supplying another VAT-registered business, you issue a VAT invoice, which carries more than the general list above. HMRC's VAT guide (Notice 700) requires a full VAT invoice to show your name, address and VAT registration number, a sequential invoice number, the invoice date and the time of supply, the customer's name and address, a description sufficient to identify the goods or services, and for each item the quantity, the unit price, the VAT rate applied and the amount payable excluding VAT, plus the total excluding VAT and the total VAT payable in sterling. For retail supplies of £250 or less including VAT, HMRC allows a simplified invoice that carries less detail and lets the buyer work the VAT out with the VAT fraction. Do not copy a VAT invoice layout if you are not VAT registered: showing a VAT line when you have no VAT number causes real problems for your customer.

What must an invoice show in the EU?

Across the EU the baseline is Article 226 of the VAT Directive (Council Directive 2006/112/EC), which lists the particulars a VAT invoice must carry. The ones that apply to nearly every business are the date of issue, a sequential number based on one or more series that uniquely identifies the invoice, your VAT identification number, the customer's VAT identification number where the customer is liable for the VAT or where you are making an intra-Community supply of goods, the full name and address of both parties, the quantity and nature of the goods or the extent and nature of the services, the date the supply was made or completed where that differs from the date of issue, the taxable amount per rate together with the unit price excluding VAT and any discount not already in the unit price, the VAT rate applied and the VAT amount payable. Article 226 also fixes the exact wording for special situations, including Reverse charge, Self-billing and Cash accounting. Member states implement the Directive in national law and can differ in the detail, so check your own tax authority as well.

When do you write Reverse charge on an invoice?

When your customer, not you, accounts for the VAT. For business-to-business services the VAT Directive puts the place of supply where the customer is established, and where the customer is the person liable for the VAT, Article 226 requires the invoice to carry the mention Reverse charge. In practice that means you invoice with no VAT line, show both VAT identification numbers and add those two words. Reverse charge also exists as a domestic anti-fraud measure in specific sectors in several countries, the UK construction industry being the best-known example, and the conditions there are narrower. Confirm your customer's VAT number is valid before you rely on the reverse charge.

Are there invoice rules in the United States?

The United States has no VAT and no single federal law that dictates what a domestic commercial invoice must contain. An invoice there is primarily a commercial and evidentiary document, so the practical standard is the universal checklist above plus whatever your customer requires (large buyers usually insist on a purchase order number). Sales and use tax is administered by individual states, and whether tax must be separately stated on the document, and at what rate, is a state-level rule, so check the revenue department of the state you are selling into. On record keeping the federal rule does bite: the IRS ties retention to the period of limitations, normally 3 years, rising to 6 years if you fail to report income that is more than 25 percent of the gross income you did report, and 4 years for employment tax records.

How should you number your invoices?

Numbering keeps your records traceable and is a legal requirement for VAT invoices in both the UK and the EU, where the number must be sequential and uniquely identify the document. Sequential numbers like INV-001, INV-002 are the simplest. If you send a lot, a year prefix such as 2026-001 makes it easy to see when an invoice was raised. The rules that matter are that numbers are unique, that you do not skip or reuse them, and that you never renumber an invoice that has already gone out. If an invoice is wrong, do not overwrite it: issue a credit note that refers specifically to the original invoice number and then raise a new one. The EU VAT Directive treats any document that amends and refers specifically and unambiguously to the initial invoice as an invoice in its own right, which is exactly what a credit note is.

When you edit the invoice number in the generator it appears on the document and in the downloaded PDF file name. See the invoice number format guide to compare schemes and preview your next few numbers.

What payment terms should you put on an invoice?

Payment terms tell the client when you expect to be paid. Net 30 means within 30 days of the invoice date, Net 14 within 14, and due on receipt means straight away. Shorter terms tend to get you paid sooner, especially by smaller clients. Whatever you choose, write it on the invoice rather than assuming the client knows. The payment terms guide explains each term in detail and turns a term and an invoice date into a real due date.

There is also a legal floor. In the UK, if you and the customer do not agree a payment date, the law treats the payment as late 30 days after the customer receives the invoice or receives the goods or services, whichever is later. Where a date is agreed it should usually be within 30 days for public authorities and 60 days for business transactions. Once a commercial payment is late you can charge statutory interest at 8 percent plus the Bank of England base rate, and claim a fixed sum for debt recovery costs: £40 for a debt under £1,000, £70 for a debt of £1,000 up to £9,999.99, and £100 for £10,000 or more, once per late payment. The EU has an equivalent regime under the Late Payment Directive (2011/7/EU), with a 30 day default, a 60 day cap on agreed business-to-business terms unless expressly agreed and not grossly unfair, statutory interest of at least 8 percentage points above the reference rate, and a minimum of 40 euro in recovery costs.

How long do you have to keep a copy of an invoice?

Longer than most people expect, and the period is set by tax law, not by your client. In the UK, HMRC states that you generally keep business records for VAT purposes for at least 6 years, and GOV.UK tells the self-employed to keep their records for at least 5 years after the 31 January submission deadline of the relevant tax year. In the United States the IRS retention periods run from 3 years in the normal case to 6 years where income is understated by more than 25 percent, and indefinitely if no return was filed. In the EU, the VAT Directive requires invoices to be stored but leaves the length of the period to each member state, so check your national rule. Saving each PDF as you send it, in one folder per tax year, costs nothing now and saves a bad afternoon later.

How do you get invoices paid faster?

• Send it promptly.Invoice as soon as the work is done while it is fresh in the client's mind and the budget is still open.
• Be specific. Clear line-item descriptions prevent the questions that delay approval by a week.
• Invoice the right person. Send it to accounts payable, not only to your day-to-day contact, and include the purchase order number if they issued one.
• Make paying easy. Include your payment details, the reference to quote and an obvious total so there is nothing to look up.
• Put the terms in writing before you start. Agree the due date and any late fee up front, so the invoice only confirms what was already accepted.
• Keep a copy. Save the PDF for your records and for tax time, and never renumber it.

Sources

Every legal requirement stated above comes from one of these published sources. They are the authority, this page is only a summary.

• GOV.UK, Invoicing and taking payment from customers: invoices, what they must include
• HMRC, VAT guide (VAT Notice 700), section 16 on VAT invoices
• HMRC, Record keeping (VAT Notice 700/21)
• GOV.UK, Business records if you are self-employed: how long to keep your records
• GOV.UK, Late commercial payments: charging interest and debt recovery
• EUR-Lex, Council Directive 2006/112/EC on the common system of value added tax (Articles 219, 226 and 232)
• EUR-Lex, Directive 2011/7/EU on combating late payment in commercial transactions
• IRS, How long should I keep records?