Invoice FAQ: 15 Most Common Questions Answered

An invoice is a commercial document sent by a seller to a buyer that requests payment for goods or services. It itemizes what was delivered, the agreed price, applicable taxes, and the payment due date.

In most countries a valid invoice must include: seller's name and address, buyer's name, a unique invoice number, the invoice date, an itemized list of goods or services with prices, any applicable taxes (VAT/GST), the total amount due, and payment terms or due date.

An invoice number is a unique identifier that lets you and your client track a specific invoice. Common formats include INV-001, 2026-001, or CLIENT-001. Never reuse a number — sequential numbering is the simplest and most reliable approach.

An invoice is a payment request issued before payment is received. A receipt is proof of payment issued after the payment is made. You issue an invoice; you give a receipt.

Net 7, Net 14, and Net 30 are the most common — they mean payment is due 7, 14, or 30 days after the invoice date. Freelancers typically use Net 7 or Net 14. Larger businesses often use Net 30 or Net 60. State your terms clearly on every invoice.

Yes. Email is the standard delivery method for invoices. Attach the invoice as a PDF, briefly summarize it in the email body (invoice number, amount, due date), and keep a sent copy for your records.

Send a polite reminder at 7 days past due, a firmer reminder at 14 days, and a final notice at 30 days. If you included a late payment fee clause in your agreement, reference it. Always keep a record of all communications.

Yes, if you are VAT or GST registered. Include your registration number on all taxable invoices. If you are below the registration threshold, you do not need to charge or show a tax number, but you also cannot charge VAT/GST.

A proforma invoice is a preliminary invoice sent before goods are delivered or services performed. It is used to get buyer approval, arrange import/export documentation, or request a deposit. It is not a payment demand.

A credit note is a document issued to correct or cancel a previous invoice, or to issue a partial or full refund. It reduces the amount the buyer owes and should reference the original invoice number.

Use Templix AI: select an invoice template, fill in your company details and line items, and download as PDF or Word. No account required and no watermark.

Yes. Sole traders and freelancers can invoice under their own name. Include your full name, address, and bank details. Check local regulations for any income reporting thresholds.

Yes, in most countries. Digital invoices carry the same legal weight as paper invoices. Many countries (including the EU) are moving toward mandatory e-invoicing for B2B transactions.

Most tax authorities require businesses to keep invoices for 5–7 years. In India it is 6 years, in the UK it is 6 years, in the US it is 3–7 years depending on the type of tax. Always check your local requirements.

A purchase order (PO) is issued by the buyer before a purchase to authorize the transaction. An invoice is issued by the seller after delivery to request payment. The PO precedes the invoice; the invoice references the PO number.