Invoicing Guide

An invoice is a legally binding commercial document issued by a seller to a buyer. It itemises the goods or services provided, states the total amount owed, and specifies when and how payment should be made.

A well-structured invoice reduces disputes, speeds up payment, and creates a paper trail for tax and accounting purposes. In most jurisdictions, keeping copies of all invoices issued is a legal requirement.

Every professional invoice should include the following:

• Your business name and address — legal name, address, phone, and email.
• Client name and address — the legal name of the company or person you are billing.
• Invoice number — a unique sequential identifier (e.g. INV-001). Required in most countries.
• Issue date — the date the invoice is created and sent.
• Due date — when payment is expected. Clearly stating this reduces late payments.
• Line items — a description, quantity, unit price, and line total for each product or service.
• Subtotal, tax, and total — break down the numbers so the client can verify them.
• Payment instructions — bank details, payment link, or accepted methods.

A consistent numbering scheme keeps your records organised and makes it easy to reference invoices in correspondence. Common formats include:

• INV-001, INV-002, … — simple sequential
• 2026-001 — year prefix for easy sorting
• ACME-2026-001 — client prefix for multi-client freelancers

Never reuse or skip invoice numbers. If you make an error, issue a credit note referencing the original invoice number instead of deleting or overwriting.

Payment terms define when and how the client is expected to pay. Common terms you can enter in the Payment Terms field:

Tax rules vary by country. Some key points to keep in mind:

• VAT (Europe): If you are VAT-registered, you must show your VAT number on the invoice, the tax rate applied, and the VAT amount. Use the Custom Fields feature to add your VAT number.
• Sales Tax (US): Rates vary by state. Some digital services are exempt. Check your state's rules or consult an accountant.
• GST/HST (Canada): Show the GST/HST registration number and applicable rate.
• Cross-border: When invoicing internationally (B2B), many jurisdictions allow zero-rating goods with a note that VAT is the buyer's responsibility (“Reverse charge mechanism”).

Cashday lets you set tax as a flat amount or a percentage. Expand the Discount / Tax / Other panel to configure it.

Studies show that clear, digital invoices get paid 3× faster than paper ones. Here are the most effective tactics:

• Include a payment link — add your Stripe, PayPal, or Wise link in the Payment Link field. One-click payments dramatically reduce friction.
• Send immediately — invoice the moment project milestones are reached, not at the end of the month.
• Use short payment terms — Net 14 instead of Net 30 shifts the default expectation.
• Follow up politely but promptly — a reminder 2 days before the due date and 1 day after recovery most late payments.
• State late fees — adding a clause like “1.5% per month on overdue balances” in the Terms field deters slow payers.

These three documents serve different purposes:

Keep a copy of every invoice you issue and receive. Most tax authorities require you to retain financial records for 5–7 years.

• Store PDF copies in a cloud folder (Google Drive, Dropbox, iCloud) organised by year.
• Name files consistently: INV-001-GlobalCorp-2026-03-01.pdf
• Reconcile invoices with your bank statements at least monthly.
• Use accounting software (Wave, FreshBooks, QuickBooks) if you issue more than 20 invoices per month.

Cashday's invoice history automatically saves a snapshot of every downloaded PDF so you always have a local backup.

Head back to the invoice generator and fill in your details. Download a professional PDF in under 2 minutes — no account required. Need step-by-step help? Visit the Help page.