Invoicing

The document asking to be paid. Legally specified, and often wrong.

What it means

An invoice must contain specified information. A VAT invoice must additionally show the VAT number, the tax point, the rate and the VAT amount.

Why it matters

An invoice missing required information can be rejected, which restarts the payment clock. It is the commonest self-inflicted cause of slow payment.

What it looks like in practice

Include a unique number, both parties' details, a clear description, the date, the payment terms and the bank details. Add the customer's purchase order number if they use them — many will not pay without it.\n\nInvoice the day the work is done.

What to watch out for

Invoicing monthly in arrears out of habit. Invoicing on completion, or in stages, can halve the working capital the business needs.

Where to get proper advice

GOV.UK's invoicing guidance, and your accounting software's template with the VAT fields completed.