Invoicing

When you’re self-employed, one of the most important things to get right is making sure you’re paid for your work. And the way you do that is by sending an invoice. An invoice is simply a formal request for payment. It tells your client what work you’ve done, how much they owe you and how and when they should pay. There are a selection of easy-to-use apps to help small businesses and the self-employed. These can generate invoices automatically and help keep tabs on what you’re owed. So, what should go on an invoice?

Here’s a quick checklist. Your name or business name and your contact details. The client’s name and address. A unique invoice number – this helps you to stay organised. The date you issued the invoice. A short, clear description of the work you’ve done. The total amount due, including VAT if you’re registered. The payment due date. And finally, your bank details or payment link.

A good habit is to number your invoices in order so you can keep track. And remember, always agree your rate and payment terms before you start the job – ideally in writing, even just in an email. When it comes to deadlines, public authorities generally have 30 days to pay you, and private businesses usually have up to 60 days, unless you’ve agreed otherwise.

Late payments do happen, and they’re frustrating. The first step is simple – send a polite reminder. Often, clients just need a nudge. If you’ve already agreed late payment fees in advance, you can add these on. But even if you haven’t, you still have rights under UK law. Thanks to the Late Payment of Commercial Debts Act, you can claim interest – that’s 8% plus the Bank of England’s base rate – and you can also charge a fixed recovery rate.

Let’s look at an example. Priya is a trainee doctor who also freelances as a medical writer. She wrote an article for £1,320, payable on publication. But 120 days later, she still hadn’t been paid. Here’s how she worked out the late fees. At 13% interest, assuming the base rate is 5%, the annual charge on £1,320 is £171.60. That’s about 47p per day. After 120 days, it adds up to £56.40. On top of that, she added the £40 recovery fee. That’s £96.40 in late fees, on top of the £1,320 she was owed. But before going that far, Priya had already sent a polite reminder and made sure she kept a record of her agreement with the client.

Remember, just because you’re self-employed doesn’t mean you’re on your own. There are freelancer organisations and unions that give advice, help with tax and support you with chasing up late payments if you need it.