There were 5.6 million small-sized businesses in the UK at the beginning of the year. If you’re a small business owner, you are aware that you need to invoice your customers in order to collect your funds and keep an organized cash flow in order to keep things going smoothly. The process of creating a professional small-scale invoice for your business isn’t that difficult however, we’ve put together the essential items to include in your invoice to assist you.
In the United Kingdom’s Companies Act 2006 A small-sized business is characterized as one that
- The company doesn’t generate a profit of greater than £10.2 million
- It does not have a balance sheet total of greater than £5.1 million
- There aren’t more than 50 employees.
What information should be included in UK small-business easy to use invoice template?
There is no correct or incorrect method to make an invoice for small businesses however it is vital to include all crucial information you need to share with your customers:
- A unique id number
- Your company’s address, phone number, name and details
- The name of the company or name of the client you’re invoicing
- An explanation of the product or service.
- The date on which the services or goods were offered
- The date on which the invoice was issued.
- The value of the product or service
- The amount of VAT If applicable
- The total amount a customer or company must pay
How do I make an invoice
It is possible to send an invoice via mail, however these days, e-mail is a more popular method since a small business invoice will be delivered quicker and with less chance that it will get lost in the process. There are a few additional measures you can follow to ensure that the entire procedure goes as smoothly as it can. It is possible to contact the customer after you’ve sent your invoice to ensure that they’ve read the invoice and have no doubts about its contents. Because you cannot be completely certain of security online It is logical to mail the invoice in a non-editable file format e.g. PDF, to ensure that thieves can’t take it over and alter the bank’s details to their own to get the cash. You can get easy to use invoice template on a lot of website to learn.
How long should you keep an invoice?
All owners of small businesses should keep all invoices that they generate in case they are audited and require to establish the legitimacy of the profit. You could be fined up to 3000 Pounds by HMRC or be disqualified from being a director of the company if you do not keep records of your accounting. You may even need to keep them for 6 years old if:
- They reveal the transaction which is longer than one accounting period
- The company has purchased an item that will last longer than six years e.g. machinery
- HMRC has launched an investigation into the compliance of the tax returns of your company.
Even if they don’t have any relevance to your business but it’s always a good idea to save your invoices safe in a location in case there is a dispute between your business and the client, it’s a good idea to keep all invoices saved in order to be quickly found and the problem resolved. If you keep your invoices as organized as possible, you’ll be able to better control your spending as well as oversee your company’s accounts payable and receivables functions.