How to Invoice a Client

How to Invoice as an Independent Contractor [+ Template]

Learn how to invoice clients professionally as a contractor and have an easier time with time-tracking, record-keeping, and compliance.

Jemima Owen-Jones
Written by Jemima Owen-Jones
April 7, 2022
Contents
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Key Takeaways

  1. Sign an independent contractor agreement outlining your payment terms at the start of the business relationship.
  2. Effective time-tracking and record-keeping are essential for calculating the price per service and backing up your costs.
  3. Automate invoicing and payment request reminders to save time and prevent late payments. 
As a freelancer or a small business owner, it’s often your sole responsibility to take care of every aspect of your business, including how to invoice a client to receive payment. Follow the instructions below to streamline your invoicing system:

Step one: Refer to the independent contractor agreement for payment terms 

Before creating an invoice, ensure that you and your client have created and signed an independent contractor agreement outlining your desired pay rate, schedule, and payment method. Some contractors prefer upfront payments, down payments, or payment upon a milestone/project completion, while others prefer hourly, weekly, biweekly, or monthly payments. 

Once you have decided on the appropriate payment schedule, you can align your invoices accordingly.

Step two: Gather the necessary information

The next step in the invoicing process involves gathering all the necessary information regarding the services performed, the number of hours spent if billing by the hour, and the subtotal of these services. Getting this information right requires effective time-tracking and record-keeping, which we’ll explain in more detail below. 

Time-tracking 

Time-tracking information is often necessary for calculating the price per service and populating your invoices. Whether you charge clients per hour, project, stage, unit, or by word, you’ll need to know your time spent to calculate your income for specific periods, improve efficiencies and design your service fees around the cost of living. 
 
If you’re billing up-front or requesting a downpayment, you’ll need an archive of this information collected over time to bill accurately.

There are many free time-tracking tools and apps available, including: 

  • Clockify
  • Toggl
  • MyHours
  • Harvest

In addition to simple start/end features, time-tracking software can collect data showing you where you are overspending time and where you’re most efficient. 


Record-keeping

Maintaining up-to-date records is another integral part of invoicing if you need to back up your costs. Good record-keeping is also essential when it comes to tax-filing, budgeting, and compliance, so keeping the following documents in a safe place is crucial:
 
  • Independent contractor agreements
  • Business expenses and receipts
  • Earnings
  • Project records
  • Tax returns
  • Professional licenses and certifications

Top tip: Store your records on Google Drive. Google Drive is a cloud-based file storage solution that will ensure your digital documents and records are in one place and accessible from multiple devices at all times. 
 
Google sheets and documents are also easier to share and edit than Microsoft Word and Excel documents that you need to download to your computer and resave every time you make an update. You can find generic invoice templates directly in Drive or download our free professional invoice templates below. 

Step three: Create the invoice

You can customize your invoices in any way you choose; however, you should include the following key elements to maintain a good professional image and avoid any errors, legal troubles, and misunderstandings later down the line:
 
  • Document name: Label the invoice document within the header using bold letters
    Company logo: If you have a company logo, include this in the header to add a touch of personalization and credibility
  • Invoice number/ code: Assign dedicated numbers to each invoice to make record-keeping easier. Simple multi-digit numbers will do, or create a unique code system containing the invoice date and client name. This system is more complicated, but it can help you quickly find the exact invoice you need if there are many
  • Invoice date: Include the sending date to prevent late payment and other miscalculations.
    Your business details: Business name, your name, and contact information (email, phone number, and maybe address)
    Client’s contact information: The same information as in the previous step, but include the billing contact or billing department of larger enterprises
  • List of services: List each service you provided individually, along with a brief description of your work, amount of hours spent working (or word numbers, for writers), hourly rate (or price per word), and subtotal for each service
    Total amount due: Total cost for services listed above; you can add applicable tax and flat rate if needed
  • Payment terms: State the payment method you accept (PayPal, Payoneer, bank account, crypto address, or something else). To learn more about payment options, check out our article on How to Get Paid as an Independent Contractor
  • Payment due date: Include a specific payment deadline to avoid confusion that may occur if you write something vague, such as “15 days from the invoice reception date”
    Late payments policy: If you have such a policy, write down the details and what happens in case of late fees

    Use our free invoice templates

    Get a head start on your invoice design with one of our custom invoice templates. Easily edit these templates to reflect your brand and personality while obtaining all the necessary details to get paid on time.

    Editable Google Sheets
    invoice template

    Google Sheets Sample Invoice Template Deel

    Use built-in formulas to quickly customize your invoice, all with the convenience of easy cloud access from your Google account.

    Download Excel Format

    Editable Google Docs
     invoice template

    Google Docs Sample Invoice Template Deel

    Get a professional yet minimal template that's easy to edit and has plenty of room for payment information and billing comments.

    Download Word Format

     

    Top tip: Add your repeating information (your contact information, business details, preferred payment methods, rules, and policies) to the template. Every time you send an invoice, make a copy of the template and add the remaining information according to each client, month, and task list. This approach will save you time and ensure you don’t copy over inaccurate information from an old client invoice.

    Step four: Send invoice in a payment request email a week before payment due date

    If you explicitly outlined your payment terms in the independent contractor agreement at the start of the business relationship, your client will expect this email. You should send another reminder email on the day the payment is due. 

    If your client still hasn’t paid you a week after the due date, you should follow up with another payment reminder email. Make sure you remain polite and professional. There may have been some unforeseen complication, so make this more of a friendly reminder.

    Finally, contact your client once weekly after the unpaid invoice’s due date if you still haven’t received payment. Most people resort to a phone call once they’ve sent a couple of reminder emails.

    Bookkeeping systems like FreshBooks, QuickBooks, and ZipBooks can send automated payment reminders with the correct programming.

    For more information on what to do in the case of late payment and to access our free payment request email templates, check out our article How to Professionally Ask for Payment From Clients.

    Automate invoicing with Deel

     It takes time and undivided attention to get invoicing right every time. Mistakes are easier without a dedicated team to oversee bureaucratic tasks and administration, resulting in fees, penalties, and late invoices that delay payment.
     
    The Deel platform has invoicing software integrations to automate your online invoicing and speed up the payment process. Every Deel invoice includes the name, address, company details, payment method, transaction details, and amount issued so that you remain professional and transparent. Deel also takes care of other documents, such as receipts and tax forms, which help you navigate compliance. 
     
    On top of that, with Deel, you and your client can choose how to process payments. That means the two of you can have different payment methods. For example, your client can pay with a wire transfer, and you can choose how you want to withdraw as soon as you have an available balance. Moreover, you can decide how much you wish to withdraw in which currency and by what method (bank transfer, PayPal, Payoneer, and even crypto).
     
    Deel users can also get a Deel Card for instant access to funds and global spending. Deel always tries to optimize for a local payout, which minimizes the fees and allows withdrawals in more than 150 local currencies. It makes the whole process favorable for both parties.
     
    Want to learn more? Request a demo on our website today.

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