The Anatomy of an Invoice
Written by Liam Dryden
This article originally appeared in our Advice section on socialcircle.media; where our mission is to support, educate, and professionalise the Creator community.
So it’s finally time to get paid for some work as a Creator!
Great work, we’re all very proud, you’re out there hustling and we’re here for it. Of course, first, you’ve been asked by the Brand to send an invoice.
Whether this is your first time writing an invoice or you’re already a seasoned pro, there’s always something you can tweak — and who knows, maybe by doing something different, you might find yourself getting paid by Brands much more efficiently!
So without further ado, here’s our breakdown of everything a good invoice should have…
The Top Bit
Company Address
All invoices need to be addressed to the Brand; and in some cases directly to the person in charge of finances. It’s worth asking ahead of time for the correct details for addressing an invoice, to ensure it gets into the right hands as quickly as possible.
PO number
Some brands also require the use of a purchase order number to identify your transaction. If needed, this is something a Brand should supply you with ahead of invoicing and you can affix it to the end of the address.
Invoice Number
For the sake of your own records, it helps to start numbering your invoices — especially if you find yourself working with a certain Brand or client multiple times.
There are a few acceptable ways to number your invoices, but the components that people tend to use to create their invoice numbers are:
- DATE: The date upon which the invoice is sent. Most people prefer to format this as YYYYMMDD.
- CUSTOMER ID: A number assigned to a client, that can be referred to in the instant of repeating clients.
- UNIQUE INVOICE ID: Literally just a sequential number that identifies the order your invoices have been written/sent.
Formatting an invoice number can look like 1–2–3, or even just 1–3 if you don’t have a lot of repeat clients. What matters is that you remember to change it every time you create a new invoice!
Optional: Branding!
If you have a logo or theme that is integral to your online branding, it can feel a bit more professional and personal to include it in your invoices!
The Middle Bit
Contact Details
It is very possible that the person in charge of processing your invoice won’t be the same person you have been dealing with up to this point, and they may need to get in touch with you with further questions. Even if not, it’s polite to include a reminder of how people can get in touch with you. An email address is acceptable, as well as a physical billing address — as this may occasionally be required for your payment.
Payment Details
The most crucial part!! Making sure you get this right and feature it prominently is key to avoiding mistakes or delaying payments. If you prefer to be paid via a service like PayPal, be sure to clarify this and include your email address. However, most Brands will prefer bank transfer, for which you will need the following:
- Account holder’s name, if it is different from your public/brand name.
- Sort code
- Account number
- IBAN and BIC — If you are working with a Brand that may be based overseas, these two numbers are codes that help your account be recognised internationally. They won’t always be needed, but it’s worth including them at all times just in case. You can get the details of these numbers from your online banking, your bank statements, or in branch.
Invoice Date
Even if it’s in your invoice number, you still want a clear indicator of the day upon which this invoice was sent; as the time frame within which you are paid can often depend quite heavily on this.
Description
Oh joy, it’s time to explain why you should be paid! This is for the benefit of the person in charge of finances, so you don’t need more than a quick outline of the job or project you have worked on with the Brand. Realistically no longer than two sentences.
Payment Terms
It’s crucial to make this part of the invoice visible and crystal clear. If you have agreed payment terms with the Brand, e.g. within 14 days, put this here. The UK standard is 30 days from invoicing unless otherwise agreed, so ensure that the Brand is fully transparent with you prior to this point (payment terms should be a part of your initial contract with them).
Calculation Table
If you need to break down the costings of your fee for any reason (i.e. days worked, products sold etc), then it helps to do so in a table that also outlines the amount you are owed. This table can look however you like, as long as one side has an outline of what the payment is for, and the other has the amount. Add a Total Amount, which is what you have agreed to be paid by the Brand.
ADDITIONALLY, if you are earning above a certain amount annually as a creator, you will have to start charging VAT on top of your fee. In the UK this is currently 20%. Be sure to include this in your invoice before calculating the Total.
The Bottom Bit
Legal Disclaimer
Getting litigious on your invoice is purely optional — but if you’ve been burned in the past by Brands who have paid later than they should, then you might want to consider flexing a bit, and showing future collaborators that you know your rights. There are guidelines from the HMRC in knowing when a payment is considered late and when to charge interest for lateness. While the late payment legislation has you covered in terms of your right to charge late fees, having a bit of writing like the following can ensure Brands will know that you know this, and avoid any unwanted lateness in the first place:
I understand and will exercise my statutory right to interest and compensation for debt recovery costs, under the late payment legislation, if not paid according to agreed credit terms.
Sign-off
Saying thanks and that you’re looking forward to working with them again is just good manners!
Now make your own!
We have included a template of the invoice we used here, in case you are interested in restructuring your own. Having a solid invoice can help Brands and you ensure that your payments get to you as soon as possible. Good luck!
Additional info
If you’d like any of the above broken down in video form, we’ve enlisted the help of Sam Uwins, Accountant for Social Influencers and Online Content Creators at MHA Carpenter Box. Allow him to explain some of the finer details of invoicing…
Are you a Creator looking to know your worth? Sign up at socialcircle.mediafor more advice, insight, and opportunity!
