How to write an invoice: download your free invoice templates

You’ve set up your own business and made your first sale, but how do you get paid? It’s likely you’ll need to send an invoice to your customer.

Creating and sending invoices can help you to get paid on time and avoid late payments, which is crucial if you want to maintain a healthy cash flow.

An invoice is a bill that businesses send to customers or clients, asking for payment for goods or services. Invoices usually include a description of the items you’re charging for along with payment terms, amongst other information.

This guide covers the following topics:

• free invoice templates for small businesses
• how to write a basic invoice
• writing an invoice – key considerations
• how to send an invoice
• issuing VAT invoices
• common invoice payment methods
• guide to invoice software
• how to write an invoice FAQs

How do I write a basic invoice?

Your first invoice can be very basic – as long as it includes a few key pieces of information. As your business grows, you can choose to make your invoices look more professional with brand colours and logos.

But if you’re creating a basic invoice to get paid, here’s what you need to include, according to the government:

• your company name, address, and contact information
• your customer’s name and address 
• a unique identification number for the invoice (e.g. 001)
• a description of what you’re charging for
• how much your charging and the total amount owed
• the date of the invoice
• the date the product or service was provided 
• VAT amount (if applicable)

If you’re a sole trader, you’ll need to include your name as well as your business name, plus a business address where legal documents can be sent.

If you’re a limited company, you’ll need to include your full company name as it appears on your certificate of incorporation. And if you choose to add the names of your directors on the invoice, you need to add the names of all directors – not just some.

What does an invoice look like?

Invoices are different to receipts (which acknowledge payment) and purchase orders (which notify intent to buy goods and services).

How do I create my own invoice?

You can do this yourself using a word processor, Excel, or online design software such as Canva. You could also use a free self-employed invoice template.

There may even be sample templates on your word processor, depending on the programme you’re using.

How to write an invoice: 5 key considerations

1. Clearly mark your invoice

Government guidelines clearly state “you must clearly display the word ‘invoice’ on the document.”

Adding the word ‘invoice’ at the top of your document could make it more likely you’ll be paid on time, as it makes your request for payment stand out from other documents your client might receive.

2. Create a unique identification number

Your invoice needs to have a unique identification number. This is for your records, as you should have a reference for all the invoices you’ve raised to make sure you don’t create duplicates. Having a unique record of all your payments also helps you to keep track of your finances.

You can use a sequence of numbers that gradually increases. For example, your 2025 invoices could use a year, month, and number format. The first invoice you send in January would have the invoice number 202501001, while the 32nd invoice you send in March would have the invoice number 202503032.

You could also use letters in front of a number, which might indicate a specific client.

3. Write a description of what you’re charging for

These descriptions don’t need to be long, but they should be detailed enough for your customers to know what it is they’re paying for.

After all, if they have no idea what they’re being charged for, they’re more likely to query the invoice – leading to a delay in payment.

As an example, you run an upholstery business and a customer commissions you to refurbish an armchair. On the invoice, you could list the cost of the materials and labour separately so they know how much they’re paying for each.

Once you’ve added a clear description of each item, you should add in the quantity of each, and the price.

4. Add up the money owed

As well as including the costs of individual goods or services, you also need to include the total amount owed.

Plus, if you’ve agreed a discount with your customer, note this down on the invoice and subtract it from the total cost.

If applicable, include the VAT amount too.

For example, you run a marketing agency and a customer buys four blogs for £300 and two social media posts for £150. You offered them a 10% discount on their total order of £450, which comes to £45. This leaves a subtotal of £405.

However, the customer must also pay 20% VAT of £81, leaving them with a total bill of £486. All of these costs will need to be included on the invoice you send them.

5. Mention payment terms

You should have agreed payment terms with the customer beforehand, but it’s a good idea to note the terms of payment on the invoice as well.

If you expect to be paid within a certain number of days, remind the customer by including it on the invoice.

More importantly, note down how exactly your customer should make the payment. It’s likely you’ll want the customer to make the payment directly to a bank account. If that’s the case, be sure to add your bank details.

Unfortunately late payments have a negative impact on the cash flow of many small businesses. Our 2025 SME Insights Report found that more than a fifth (23 per cent) were owed up to £5,000 at the time of our survey.

Encouraging quick payment by including clear payment terms – as well as making it easy for customers to pay you – should help to reduce late payments and improve your cash flow.

How to send an invoice

The quickest and easiest way to send your invoices is by email. You can attach your invoice in an un-editable PDF format (to prevent fraud) and include a clear, brief description of your business and invoice in the subject line and body of the email.

Different customers and clients might have different processes for receiving invoices. It might be a good idea to test if there’s certain information to include in the subject line that’ll help you get paid faster.

After you’ve sent an invoice, you could choose to give your customer a phone call to check they’ve received it – and if the payment isn’t forthcoming, you can give them a polite nudge.

Alternatively, there’s software that can take the hassle out of sending invoices. In some cases, you can create and send invoices directly from a mobile app.

If a customer has multiple outstanding invoices, you might also choose to send a statement of account to help them keep track of what they owe (and pay you on time).

At this stage, you may also want to consider sending a late payment or overdue invoice letter.

Issuing VAT invoices

The government states that you should use VAT invoices if you’re VAT-registered. These invoices need more information on them than normal invoices.

There are three types of VAT invoices you can issue:

1. A full invoice
2. A modified invoice for retail supplies over £250
3. A simplified invoice for supplies under £250

The information you need to include depends on the type of VAT invoice you’re issuing. Read more about guidelines for VAT invoices on the government website.

In general, though, they need the same information as normal invoices, plus:

• your VAT registration number
• the tax point (time of supply) if it’s different to the invoice date
• the VAT rate and total VAT charged, if all the items are charged at the same rate
• if different items have different VAT rates, then show this for each one

What are the most common invoice payment methods?

Most businesses accept a variety of different payment methods. It’s important to include what payment methods you accept on your invoices so customers know how to pay you.

The table below shows some of the most common types of payment methods and what needs to be included on an invoice.

How to write an invoice FAQs

What details must be included on an invoice in the UK?

Businesses in the UK must include the following information on an invoice:

• company name, address, and contact information
• customer name and address
• unique identification number (e.g. 001)
• description of what’s being charged for
• the cost of each item or service and the total amount owed
• the date of the invoice and the date the product or service was provided 
• VAT amount (if applicable)

There are different requirements if you’re a sole trader, limited company, or VAT-registered.

Do sole traders need to include VAT on invoices?

Sole traders only need to include VAT on their invoices if they’re VAT-registered.

VAT invoices require specific details, such as:

• VAT registration number
• the tax point (time of supply), if it’s different to the invoice date
• the VAT rate and total VAT charged (if different items have different VAT rates, then show this for each one)

Can I create an invoice without software?

Yes, you can create an invoice without software, using a word processor, spreadsheet, or design tool like Canva. A lot of programmes also have invoice templates. 

No matter how you create your invoice, it must include key information such as how much is being charged, the date, and a unique identification number.

More guides for small businesses

• Small business grants: everything you need to know
• Self-employed tax brackets 2024/25
• What is a sinking fund? A small business guide
• What type of business insurance do I need?