How to create and send professional invoices as a sole trader or limited company. What to include, legal requirements, chasing payment, and invoicing software.
·3 min read
Getting paid correctly and on time is essential for any self-employed person. A professional invoicing process looks credible, ensures legal compliance, and helps you maintain healthy cash flow.
What to Include on an Invoice
Required Elements
Element
Detail
Your business name
Trading name or company name
Your address
Business or registered address
Customer name and address
Who you are invoicing
Unique invoice number
Sequential (e.g., INV-001, INV-002)
Invoice date
Date the invoice is issued
Description of goods/services
Clear description of what was delivered
Quantity and rate
Hourly/daily rate × hours/days, or project fee
Total amount due
Before and after VAT (if applicable)
Payment terms
When payment is due (e.g. “Net 30”)
Payment details
Bank account number, sort code, or payment link
Your UTR or company number
UTR (sole trader) or Companies House number (Ltd)
Additional for VAT-Registered Businesses
Element
Detail
VAT registration number
Your VAT number
VAT rate
Rate applied (standard 20%, reduced, zero)
Net amount
Total before VAT
VAT amount
VAT charged
Gross amount
Total including VAT
Invoice Example Layout
Field
Example
From
Jane Smith Consulting, 10 High Street, Bristol, BS1 1AA
To
Acme Ltd, 20 London Road, London, EC1A 1AA
Invoice number
INV-2025-042
Date
15 October 2025
Due date
14 November 2025
Description
Website development — Phase 2 (40 hours @ £50/hr)
Subtotal
£2,000.00
VAT (20%)
£400.00
Total
£2,400.00
Payment
Sort code: 12-34-56, Account: 12345678
Payment Terms
Term
Meaning
Best For
Due on receipt
Payment expected immediately
Small, urgent invoices
Net 7
Due within 7 days
Quick turnaround work
Net 14
Due within 14 days
Standard for smaller businesses
Net 30
Due within 30 days
Most common; professional standard
Net 60
Due within 60 days
Larger corporate clients (try to avoid)
Deposit and Milestone Payments
Approach
When to Use
50% deposit, 50% on completion
Projects for new clients
30/30/40 split
Larger projects with milestones
Monthly invoicing
Retainer or ongoing work
100% upfront
Small, fixed-price jobs (if client agrees)
Chasing Late Payments
Stage
When
Action
1
1 day overdue
Friendly reminder email
2
7 days overdue
Follow-up email or phone call
3
14 days overdue
Formal letter referencing payment terms
4
30 days overdue
Final notice with late interest warning
5
60+ days overdue
Consider statutory interest, mediation, or Small Claims Court