Whether freelancing is your side hustle or a full-time gig, these invoicing tips will help you streamline billing processes, show professionalism to your clients, and ensure timely payments for your freelance services.
1. Define Clear Services and Prices
This might seem like a no-brainer, but so many freelancers struggle to explain their price policy. Vague pricing is simply bad for business since it leaves too much space for interpretation and uncertainty. Clear service descriptions and transparent pricing play crucial roles in freelance business:
- set expectations for your client regarding the project scope (what deliverables and quantity of work they can expect within the budget)
- avoid misunderstandings and disputes regarding the invoice – clients are less likely to have questions or concerns about the invoice therefore you both save valuable time
- transparent pricing makes it easier for clients to understand the cost breakdown, and they are more likely to process payments without delay.
2. Have a Professional Contract
Although new projects are exciting and you might just want to jump in head first, always remember that you’re in control of your freelance business and a locally compliant contract will give you legal grounds to request payment, as well as it will serve as proof of income for when it’s time to file taxes.
This contract should specify
- your hourly rates or service rates
- what services you will provide during this agreement
- what is the estimated cost
- how the payment(s) will be made
- when the payment(s) are due
If the project is big and time-consuming you can agree on a periodic payment schedule, splitting the project into smaller checkpoints. This will provide you with a healthier cash flow and also protect you from endless additional changes.
3. Check All Essential Information
Incorrect invoices often lead to missed payments, additional time and effort to communicate with the client, sometimes even breaking local tax laws, losing future projects, and other problems. Make sure your invoices have all this information in check:
- your name or business name
- contact information
- contract number
- client’s name and contact details
- invoice number
- invoice date
- due date
- an itemized list of services together with descriptions, quantity, and rates
- applicable taxes, and the total amount due
See here what an invoice issued through Abillio looks like.
By the way, for marketing purposes you can add information about your social media profiles to stay in touch.
4. Invoice Straight Away
Timely invoicing improves cash flow and reduces the risk of payment delays as well as portrays professionalism. You can either create an invoice yourself and send it as a PDF attachment via email or use professional invoicing software. The best practice for emailed invoices is to:
- have a clear subject line that states the purpose of the email and makes it easy to find if needed later
- summarize the main points of the invoice in the email body text, including the invoice number, due date, and total amount due
- thank your client for their business and express hopes to work again together
Dedicated invoicing platforms such as Abill.io offer customizable templates, automated invoicing, and easy payment options, streamlining the invoicing process as well as maintaining consistency in your invoicing format, layout, and branding. They will also send out a polite follow up-email if an invoice is overdue to remind your clients that a payment is required. Usually, automated reminders are perceived as more professional and don’t bring negative emotional aspects to them.
5. Define Seamless Record-Keeping System
If you’re working on multiple projects at once, a financial record-keeping system becomes essential to make sure you:
- track your finances
- monitor payment statuses and cash flow
- have a way to back-track your invoices
- know what amount of taxes you need to pay
- generate client database
Hope these tips answer your questions and will help you in the future with all aspects of invoicing. But if you still feel overwhelmed with the invoicing process, know you can always choose a virtual company like Abill.io that takes care of your legal setup, VAT invoicing, accounting, and TAX payments, supporting your hassle-free freelancing journey.
