How to Create a Freelance Invoice in 2024 [+ Free Templates]

Knowing how to create an adequate invoice is essential if you’re working as a freelancer. Not only is it a form of legal contract between you and the client, but it also helps you receive payment on time, appear more credible, and much more!

If you are looking to create a freelance invoice for your services, you have come to the right place. In this guide, we’ll show you how to make a perfect one in a breeze and with zero complications, thanks to our online invoice generator!

Key Takeaways

• Freelancers do not have the same legal protections that come with working for a company.
• There are many benefits to creating freelance invoices, including professional looks, simplified tax payments, improved bookkeeping, and better payment tracking.
• Contact information of both parties, a unique invoice number, due dates, a breakdown of the work, and payment options should always be included on freelance invoices.
• There are multiple kinds of freelance invoices, including recurring, pro forma, prepayment, commercial, and standard ones.
• You can send the invoices once or twice per month, at the beginning or end of the month, depending on the project size.

What Is Freelance Invoicing & Why Is It Important for Freelancers?

Freelance invoicing is the process of documenting the services provided by a freelancer to a specific client and the corresponding rates for each. By creating these, these individuals can request payments accordingly from each client.

Besides providing a full overview of all the services provided, a freelance invoice also helps you with recordkeeping and taxpaying processes. Additionally, it serves as proof of the work you have accomplished and as a transactional record between you and the businesses or clients who hired you.

Freelance Invoice Types

Invoices for freelancers come in various forms, and being familiar with these can help you choose the best type of document for you and your work.

With this in mind, let’s take a look at the different types of freelance invoice you can use:

• Recurring. You can create this type of invoice when a client frequently requires the same type of service, as there’s no need to make a separate invoice for each occasion.

• Pro forma. Before you provide the service, you can request payment with a pro forma invoice that includes an estimated pay rate for the offered service.

• Standard. A standard invoice gives the client all the details about the services they need to pay for after these have been delivered.

• Prepayment. With this type of invoice, the client must provide a down payment or a portion of the total before the service is rendered.

• Commercial. You can use this type of invoice when the service you should provide entails the transshipment of goods, as it acts as a type of customs document.

• Timesheet. This kind of invoice includes a breakdown of the hours required to execute the task the client requested. Therefore, the payment is based on the number of hours worked.

What to Include on Your Freelance Invoice

Now that you know more about all these kinds of freelance invoices, it's time to pinpoint what you should include in them.

#1. Contact Information Header

Always provide contact details on your invoice. A higher placement at the top would be preferable, along with a company logo.

Contact information is necessary because it facilitates communication between you and the client. Moreover, it showcases the participants in the process, providing a sense of legal security in case disputes do emerge.

#2. Invoice Number and Dates

The invoice number and date of issuance can be seen right underneath the contact details.

Each invoice is assigned a special number. This number guarantees that the income is accurately recorded for accounting and taxation needs. It's also good for monitoring late or unpaid invoices.

When it comes to the date, it should encourage your clients to pay you within the given time frame and help you keep track of the invoices.

#3. Work Breakdown

In this section, the invoice should include the following information:

• Type of service you are providing
• Quantity of the work you are delivering
• Total cost of the service

You won't be able to request payment from the client or receive compensation if you don't have this information. To develop a mutual understanding and prevent any future issues, it is essential that your client understands exactly how much they need to pay and what they are paying for.

#4. Payment Methods

Payment terms may appear with the work description or right after it.

As the title suggests, this section should contain information on the preferred payment methods. Do you take direct deposits, bank transfers, or PayPal? What details should the client use while making a payment? Be sure to answer these questions as you finish working on your freelance invoice.

When & How to Send the Invoice

The dates selected for issuing freelance invoices depend on the size of the project and the conditions you have set. Let's consider a few examples:

Big Project

If you are a freelancer working on a large project, it would be ideal to issue an invoice at least once a month so that you can have consistent cash flow. This way, your client will also be reminded to meet the payment deadlines on time, which will enable them to avoid missing or delayed payment.

Small Project

It will be most practical for both parties if you deliver the invoice just once when you are working on a short project. So, if the project takes a few weeks or a month, you can send the invoice either at the start to get paid before you deliver the product or at the end once the service is provided.

Fixed Hours

This indicates that you have set a certain time for sending the invoice. Depending on when you would like to get compensation, you can invoice the client at the beginning of each month, on the 15th (which puts it in the middle of the month), or at the end of the month.

Benefits of Creating Freelance Invoices

Creating freelance invoices has a lot of advantages. Let's look at a few of the most notable ones:

Professional Looks

Clients will know that you're a professional if they see you take care of your paperwork and pay attention to every detail.

Apart from leaving a good impression, a good freelance invoice will also make clients more inclined to trust your services or book you for more than one job. Needless to say, it can also help you stand out as a verified professional and grow your business.

Great for Tax Purposes

The tax you are required to pay for that specific transaction should be included in your invoice. You may simply compile all of your invoices for the relevant period when it is time to pay taxes.

It would be challenging and time-consuming to calculate exactly how much you are obligated to pay after you have completed the transactions without the invoicing system. With it, you can simply compile all your invoices for the relevant period when it’s time to pay taxes and make the process easier.

Better Bookkeeping

Invoices are used to keep track of the finances of your company, or in this instance, the freelancing services you are offering. They are an excellent tool for bookkeeping because they serve as a record of every sale you have ever made.

Thanks to them, you can also calculate your revenues, profits, and overall cash flow. This can help you create a solid strategy for boosting your profit.

Payment Tracking

You would undoubtedly want to keep track of your payments if you were a freelancer or an organization providing a specific type of service. Fortunately, you can easily do so with the help of invoices.

You can also readily determine if any payments are overdue because invoices clearly state when they were issued and when the payments were due. Since these documents also include the contact information of both parties, you’ll be able to speak with the client about the matter and eventually get paid.

To be on the safe side, you can also consider adding a late payment fee to your invoice as well.

4 Common Challenges & Mistakes Freelancers Face with Invoicing

Creating freelance invoices doesn’t come without its own challenges, and knowing how to avoid these is essential to ensuring seamless transactions when requesting client payments.

Below, we have listed four common mistakes freelancers make when invoicing their services:

Delayed Payments

Late payments cause constant financial stress and disrupt the cash flow for freelancers. Unlike full-time employees who regularly get paid at fixed dates or days each month, freelancers often have to wait up to 14 days on average before they receive compensation.

In fact, statistics by Bonsai, a provider of business management and automation tools for freelancers, show that around 90% of unpaid and overdue freelance invoices were only settled after a month.

Inadequate Record-Keeping

Being a freelancer entails being responsible and organized in updating and maintaining your own financial records.

Since you work with multiple clients and different projects, you need to establish a systematic and reliable way to sort your invoices for each client. Doing so will make it easier to double-check payment statuses and easily find specific documents whenever you need them.

To make the recordkeeping process simpler, you can use Paystub.org’s invoice generator and save time when creating freelance invoices. The generator comes with ready-made templates and a built-in calculator that lets you create as many invoices as you need while also minimizing potential errors!

Miscommunication

Miscommunication regarding your billing rates, additional fees, and the scope of work you provided is a common and running theme in freelancing. Some clients tend to demand more work but may be skeptical about paying higher rates, thinking that hiring freelancers is supposed to help them save on operational costs.

To prevent this, always ensure you communicate clearly with your clients, inform them about your payment terms, and define the scope of work on time.

Facing Disputes and Complaints

Ensuring that your invoice contains consistent and accurate information is crucial in minimizing inconsistencies in your financial documents and transactions. Plus, it also prevents possible invoice disputes with your client.

Therefore, you should always honor your contract with your clients at all times and follow through with what you have promised to help your clients achieve through your services.

Strategies for Following Up on Unpaid Invoices and Handling Disputes

Some strategies you can incorporate into your work routine to steer clear of the possible pitfalls of earning independently include:

Following Up

Being a freelancer means you must learn how to be assertive when specifying your rates and charging payments from clients. You can start by learning how to draft different versions of your reminder and follow-up emails.

Additionally, you must create a timeline for every project so that you can plan your invoice due dates ahead and avoid mixing up the payment dues of one client with that of another.

Lastly, try to use more than one communication channel when reaching out to your clients, and document every transaction or change to your terms of service.

Dealing with Late Payments

Establishing a late invoice payment policy is an effective way to regulate the possibility of overdue client payments.

If possible, discuss your late payment policy while negotiating your rates and confirm your client’s compliance before commencing the project. Otherwise, the failure to explain your terms and policies could jeopardize your chances of escalating your client’s unpaid dues to collections.

Handling Disputes

When handling client or invoice disputes, you must have complete documentation of all your agreements, emails, project negotiations, and invoices. That way, you will be equipped with enough evidence to defend yourself in case there are any issues and assert your rights as a freelancer. Remember to remain calm and practice professionalism above all.

Also, if your client refuses to negotiate, try to find legal alternatives to resolve the issue without compromising your work and your business practices.

6 Tips & Best Practices for Freelance Invoicing

Even though you may already be aware of how to proceed with issuing invoices, a few more pointers won't hurt!

#1. Use Clear and Professional Templates

While a freelance work setup may be more laid-back, professionalism and a good work ethic should still be at the core of your trade. As such, using invoice templates with sloppy formatting should not be excused.

Use online tools like our invoice generator, Google Workspace, and word processor programs to prepare consistently neat and professional-looking invoices for all your clients.

#2. Be Prompt and Consistent

Don’t delay your invoicing process, and stick to your schedule. Also, aim to complete your tasks in a timely manner and be consistent with the quality of your work.

By showing your clients that you respect and value their time, you are also prompting them to do the same by ensuring they abide by your freelance invoice terms.

#3. Include Detailed Descriptions

Providing a detailed description of your services on your freelance invoice enforces transparency and reliability. After all, there shouldn’t be any problems describing and explaining honest work.

You also get to save yourself the trouble of having to explain your invoice details repeatedly.

#4. Keep Communication Lines Open

You are mistaken if you think that adding your company name and address would be sufficient. You must provide an email address or a phone number that you use frequently so that your clients can reach you easily.

#5. Require Down Payment

You can require upfront payments for your services and secure cash flow.

You can create a down payment invoice to document the required upfront payment and update your accounting records. Later on, you can check and deduct the initial payment from your client’s remaining balance.

#6. Offer a Variety of Payment Options

There have been countless instances where people have been denied compensation simply because the client was unable to accept the suggested payment method.

To avoid this, you can list a few payment options that work best for you. This way, the client will have more options in case one of the payment methods you suggest doesn't work for them.

Freelance Invoice FAQ

#1. How do I write a freelance invoice?

Writing a freelance invoice is not as difficult as it may seem. The order of the information should be as follows: contact details first, date, invoice number, work description, payment methods, and overall sum at the bottom.

You may always utilize a freelance invoice generator or consult freelance invoice examples if this still sounds a little challenging to you.

#2. Is there a freelance invoice template in Google Docs?

Yes, both sample and professional invoice templates are available in Google Docs—you can edit them and add your information as desired.

#3. Should I add my logo to the freelance invoice?

It's always a good idea to include a logo on the invoice. Your client will know exactly who they are working with, which helps you stand out from the competition. Clients will trust you more because of the professionalism and credibility this little detail gives to your service.

#4. How frequently should I send out the freelance invoice?

There are a few variables that affect the frequency. For example, if you are engaged in a small project, it is best to send the invoice out just once—either before the work begins or after the product has been delivered. If you are working on a larger project, you can send it out once or even twice a month.