An invoice turns finished work into money, and in the UK there are rules about what it has to show. A complete invoice gets paid faster, because nobody in the client’s accounts team has to email you about a missing detail. It’s also your record for HMRC, and the starting point for claiming interest if a client pays late.
I’m a freelance web developer in Scotland, so I send invoices to clients myself, and I built the NiftyKit Invoice Generator for exactly that kind of work. I’m a developer, not an accountant, though. This guide follows GOV.UK’s guidance as I understand it, and I’ll say where an accountant is the better person to ask.
What every invoice should include
GOV.UK’s page on what invoices must include sets out the basics. Whether you’re a sole trader or a company, VAT-registered or not, your invoice should show:
| Item | Notes |
|---|---|
| A unique identification number | One sequence, never reused. More on numbering below. |
| Your name or business name, address and contact details | Sole traders using a business name have extra rules (see below). |
| Your customer’s name and address | Use their legal or trading name, not just the contact person. |
| A clear description of what you’re charging for | Specific enough that someone else could tell what was supplied. |
| The date the goods or service were provided | The supply date. For ongoing work, the period it covers. |
| The date of the invoice | The date you issue it. |
| The amount or amounts being charged | Per item or per line. |
| VAT amount, if applicable | Only if you’re VAT-registered. |
| The total amount owed | Clearly, so there’s no doubt what to pay. |
It’s also sensible to label it clearly as an invoice and add your payment details and a due date. They aren’t on GOV.UK’s list, but an invoice without them tends to sit in an inbox.
If you’re a sole trader
If you trade under your own name, your name and address cover it. If you use a business name, GOV.UK says the invoice must also show your own name alongside it, and an address where legal documents can be delivered to you.
The Invoice Generator has one field for your business or trading name. I’d put both in it, for example “Alex Brown, trading as Brown Web Design”, and your address in the address box below.
If you run a limited company
A limited company must show its full registered name exactly as it appears on the certificate of incorporation. GOV.UK also says that if you choose to list any directors’ names on your invoices, you have to list all of them.
Companies must also show their registration number and registered office address on business letters, order forms and their website. Most put them on invoices too. If you’re unsure what your company’s documents need, ask your accountant.
If you’re VAT-registered
Only VAT-registered businesses can charge VAT. If you’re not registered, don’t add VAT to your invoices or show a VAT line, even at 0%.
Once you are registered, a full VAT invoice needs more detail. HMRC’s VAT guide (Notice 700) has the full rules, but the main additions are:
- your VAT registration number
- the time of supply (tax point), if it’s different from the invoice date
- for each line: a description, the quantity, the unit price excluding VAT and the VAT rate
- zero-rated or exempt items shown clearly as having no VAT
- the total excluding VAT, the total VAT and the total including VAT
- any discount, shown separately
There’s also a simplified VAT invoice with fewer details, for sales of £250 or less including VAT. For client work, most people just issue a full one.
In the Invoice Generator, choosing VAT invoice warns you if your VAT number, the customer’s details or a line’s VAT rate is missing (enter 0 for zero-rated items). It can’t tell you whether your rates are correct. If you’re unsure which rate applies, ask an accountant.
Payment terms and late payment
Put a due date on every invoice. If you and your client haven’t agreed payment terms, the law sets a default: payment is due 30 days after the customer receives the invoice, or after you deliver the goods or service if that’s later. Agreeing terms in writing before you start is better.
The Date Calculator adds any number of days to a date, and the Invoice Generator has quick buttons for on receipt, 14 days and 30 days.
Statutory interest and compensation
If another business pays you late, the Late Payment of Commercial Debts (Interest) Act 1998 lets you claim statutory interest at 8% a year plus the Bank of England base rate. It applies to business-to-business invoices only, not to private individuals, and not if your contract already sets a different rate of late payment interest. GOV.UK’s page on late commercial payments has the details.
The interest is simple, not compound. Multiply the amount owed by the annual rate, divide by 365 for a daily figure, then multiply by the number of days overdue. As an illustration only, if base rate were 4%, the rate would be 12% a year and a £2,000 invoice would gather about 66p a day. The Date Calculator’s days between two dates option tells you how many days late a payment is.
You can also claim a fixed sum for the cost of recovering the debt, once per invoice:
| Amount owed | Fixed compensation |
|---|---|
| Up to £999.99 | £40 |
| £1,000 to £9,999.99 | £70 |
| £10,000 or more | £100 |
Whether you claim is a judgement call. A polite reminder often does the job and keeps the relationship intact, but knowing the rights exist makes that reminder easier to write.
Habits that make invoicing easier
Number invoices in one sequence
Pick a format, such as INV-0001 or 2026-001, and stick to it. Don’t restart for each client, and don’t reuse or delete numbers. If you make a mistake on an invoice you’ve already sent, issue a credit note to cancel it and then a new invoice, rather than editing the original.
The Invoice Generator doesn’t remember anything between visits, but Save details to a file stores your details on your device. Open that file next time and choose Start a new invoice: it keeps your details and payment information, clears the customer and items, and moves the number on by one (INV-0009 becomes INV-0010). Keep your own list of what you’ve issued and what’s been paid.
Write the supply date into the description
The generator has an issue date and a due date but no separate supply date field, so I put the date or period into the line description: “Website maintenance, October 2026”.
Track time if you bill by the hour
Hourly invoices need hours you can stand behind. The stopwatch in the Timer and Stopwatch records laps you can copy as CSV into a spreadsheet, and the Pomodoro Timer has a Copy log button for completed sessions. Neither keeps anything once you close the tab, so copy the record before you stop.
Send a PDF with everything attached
A PDF looks the same on every device and is hard to edit by accident. The Invoice Generator creates one in your browser, and nothing you type is uploaded or stored. To send a timesheet or expense receipts with it, PDF Merge and Split combines them into one file, with each photo of a receipt as its own page.
Make paying you easy
Include your sort code and account number, or a payment link, and ask the client to use the invoice number as the payment reference. Send the invoice to whoever pays it, often an accounts address rather than the person you worked with. If a client uses purchase order numbers, get one before you invoice: the generator has a field for it.
Chase on a schedule
A friendly reminder just before the due date, another the day after, then a firmer one a week or two later. Attach the invoice each time so nobody has to search for it.
Keeping records
HMRC says sole traders must keep business records for at least 5 years after the 31 January Self Assessment submission deadline for the tax year they relate to. Limited companies must generally keep records for 6 years from the end of the financial year they relate to. VAT records must be kept for at least 6 years. See GOV.UK’s guidance on how long to keep records.
Keep a copy of every invoice you send, in a folder you back up. If Making Tax Digital for Income Tax applies to you, you’ll also need digital records in compatible software.
Setting money aside for tax
An invoice total isn’t all yours to spend. As a sole trader you’ll owe Income Tax and National Insurance on your profits, usually some months after you’ve been paid. On SmartCalc Hub, my other site, I’ve written about how much to set aside for tax as a UK freelancer, and the self-employed tax calculator gives an estimate for your own figures.
Before you send your next invoice
Run through this quick check:
- Is the number next in your sequence, and unused?
- Are your name, any trading name, and your address on it (or your company details)?
- Are the client’s correct name and address on it?
- Does each line say what you did and when?
- Are the amounts right, with VAT only if you’re registered?
- Are the due date and payment details clear?
- Is it going to whoever actually pays?
Then save a copy, note it in your records, and put the due date in your calendar so you know when to start chasing.