Creating invoices
When you create an invoice, make sure its accurate and includes all the following information:
- your business name
- your customer’s name and address
- the invoice number, date sent and due date
- a description of the goods or services provided
- the amount payable
- payment details
- a buyer’s reference – for example, purchase order number.
Taxable supply information for GST
From 1 April 2023, the requirement to use tax invoices has been replaced with a more general requirement – to provide and keep certain records known as taxable supply information.
The rules set out the minimum set of records required to support the figures in your GST returns.
You only need to record taxable supply information for supplies worth more than $200, but it’s still a good idea to document these for your records.
Sending invoices
Send the invoice as soon as the work is finished, while the value of your work is still fresh in your customer’s mind. Consider the fastest way to invoice your customers.
eInvoicing
With eInvoicing, invoice information is sent directly between buyers’ and suppliers’ financial systems, even if these systems are different. Benefits include:
- more accuracy and security
- less process time
- quicker payments.
Invoicing tips
Here are some tips to help you get paid on time:
- Talk about cost estimates up front – set expectations with your customers before you start work.
- Confirm contact details.
- Keep invoice details clear – what you provided, when you provided it, the cost, due date and payment terms.
- Invoice the customer as soon as the work is done.
- If you’re doing work over a long time, consider splitting the total invoice into smaller payments.
- Offer flexible payment methods.
- Keep an eye on the invoice due date, and send reminders to the customer to make sure they don’t miss the payment.
- Check in if the due date is looming. A phone call or email can help make sure your bill doesn’t fall off the radar.
Chasing debtors
Keep a record of who has outstanding invoices and how much they are overdue.
If invoices aren’t paid on time, you should:
- follow up as soon as possible
- have a process for what happens and when – for example, an email reminder two business days after the due date, and a follow-up phone call if you’ve had no response after a week
- keep early reminders short and polite.
Common mistakes
These are some common mistakes to be aware of when you invoice customers:
- Leaving too much time between finishing the job and sending the invoice.
- Not keeping clear records or contact details of who owes you money.
- Not having a process for what to do if a customer doesn’t pay.
- Waiting too long before getting in touch with debtors.
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