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Ok, so you have decided to become a Freelance Student. You’ve gone out and touted for work, well done! Now it’s time to think about invoicing, and it’s a bit of a head-scratcher. Or it certainly can be if you don’t know how to approach it.

When you commence your freelancing career there are loads of important things to do. Defining your business and finding commissions are what freelancers tend to think about most. What often gets overlooked is invoicing. Invoicing is essential to remind your clients to pay you. Without a fool proof invoicing system in place, you could end up bashing your head against a wall waiting for a client to pay.

We want you to be clear about invoicing, it really couldn’t be simpler, here’s all you need to know about invoicing.

The Basics

No matter whether you are using an online invoicing system, of which there are many to choose from (see below), or a paper template (also see below), you need to make sure you’ve included the basics:

• The dates of completed work.
• The date payment is expected (pre-agreed).
• Itemise your invoice: Include a brief description of the work and the cost of said work.
• Your name, address and contact details.
• Ditto, for the client.
• Your payment details – bank details or any other payment instructions.
• An invoice number so you can keep track.

Agree On Payment Date

Before you complete the work, agree on the date of payment (usually within 30 days of completion). Many clients will pay all of their invoices at a set time each month – ensure you know when this is and state that you require payment on the first payment date, after completing the project. Also, find out how the payment will be made i.e. cheque or BACS (banking system used by employers to pay wages).

You are entitled to charge interest and a £40 late payment fee as long as you include this statement, or similar, in your invoice:

‘We understand and will exercise our statutory right to interest and compensation for debt recovery costs under the late payment legislation if I am not paid according to agreed credit terms.’

Define Your Terms

When you send your bid for the job – or whilst negotiating, you should set out all your terms. The best way to avoid non-payment or disagreements is to use a freelancing contract.

You can purchase a template here the great thing is you can buy a contract specifically tailored to your industry or role.

Or create a free one, here

Online Invoicing Systems

Online invoicing apps are invaluable to the freelancer. They can help save you time and take the misery out of invoicing. When I first started freelancing I used paper invoices based on a Microsoft Word template, which is ok, if you want to make it hard for yourself. But with online apps you can set reminders and schedule invoice send outs, making invoicing super-simple and allowing you to keep track. Also online invoicing apps help minimize the pain (well emotional. not financial. You still have to do it!) of accounting and tax. All the info you need is at the click of a button when you need it.

• Freshbooks

This is the system I use. I really can’t fault it. It’s free to use, on a freemium basis (you can pay to upgrade for increased services if required) and for this, you get up to three clients (you’ll need to upgrade to add more). Some of the great features include being able to brand your documents. You can add logos to make it super professional, create time sheets and even have the option to send invoices by post.

• Simply Invoices

This is great if you use Basecamp as you can integrate them. If you are signed into Basecamp you can send invoices directly from your account saving you time logging in and out. Simply Invoices is also free to use on a freemium basis.

• Cashboard

Another freemium invoicing site that also integrates with Basecamp, Cashboard has all the standard features such as invoicing, reporting and time tracking (software which manages timesheets) , and has loads of customers and great feedback. An added bonus with Cashboard is the facility to send estimates to your clients.

• PayPal

Yeah, that’s right even PayPal has a totally free invoicing system, check it out.

But, If You Want To Invoice The Old Fashioned Way…

You can find a template here.

We hope this guide has demystified the process of invoicing and armed you with the tools to get on with freelancing and get paid, on time.

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This entry was posted on Wednesday, March 21st, 2012 at 10:28 pm and is filed under Finance, Web 2.0. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.