So To Speak, a magazine for members of the Canadian Association of Professional Speakers January 2004
Invoices-the Silent Ambassador
By Eileen Reppenhagen, Tsawwassen, British Columbia
Invoices leave a lasting impression. Does your invoice say “I am a professional” to your clients?
Here are the ingredients of a professional invoice.
The invoice should be issued promptly and dated as of delivery of goods or services. Delays in billing can indicate poor cash management skills.
Invoice numbers are issued sequentially for numerical control. Often consultants do not number their invoices, or the number includes the year as part of the number.
Registration is required when sales in any four consecutive calendar quarters equal $30,000. Sales include reimbursement of expenses such as travel. Lack of GST number can indicate the consultant is new, not very successful or not reporting his or her income.
Your legal description
Include your full name, postal address, telephone and fax numbers and your email or website address. I have seen many invoices with creative proprietorship names, no contact name, some sort of address and no phone number or email address.
Customer’s legal description
Customers will appreciate your use of their legal description. Besides, without their legal description, if they default on payment, you cannot file in small claims court.
Location of sale
If you sell goods & services to customers in other provinces or countries, you will need your location for tax purposes.
Your customers appreciate references to contracts, purchase orders, contact names. Keep this paper work in alphabetical customer or job files.
There are practical reasons for knowing how the product was delivered. For instance, it is important for tax on out-of-province shipments. Was it picked up or delivered from the printer to your customer by courier? Which courier? When it was delivered? Was it prepaid or sent collect?
Do you expect to be paid in advance, when invoiced, or 30 days? Will you grant discounts for early payment? Will you charge interest at, for example, 2% per month? If you do not include payment terms, you lose the right to charge later.
Customers appreciate a clear description of the goods, services and expenses including date, quantity, description and price.
Charge GST/HST to Canadian customers for goods, services and reimbursement of expenses. Charge GST/HST on the PST for reimbursed expenses. Charge GST/HST on the contract price on completion, not on deposits. Keep copies of expenses reimbursed to claim the expense and GST Refund.
Here's the link for what CRA reports must be included on any invoice where GST/HST is charged - depends on how much the invoice is for, whether that's $30, under $150 or over $150...
You are responsible for PST on most non-book products. Refer to each provincial finance website for their rules.
The total refers to the goods, services or reimbursements plus taxes. The purpose of an invoice is for the seller to record a sale and for the purchaser to record a purchase. Do not include payment information or try to turn your invoice into a statement of account. Issue a separate statement of account to summarize transactions.
E. & O. E.
This is short for ‘Errors and Omissions Excepted’. This gives you the right to add missed charges or correct mistakes.
Be grateful. If you want repeat business, say it.
Policies and Procedures
State your return policy clearly.
Customize your invoice’s layout and design. Add a logo. Ensure that the font size is large. You want to get paid, so make it easy to read. Remember that convincing, fraudulent invoices get paid. Con artists put a lot of work into their invoices to make sure all the ingredients are convincing. If your invoice does not look at least as good as theirs, how can you hope to get paid?
Invoices should be in triplicate. Give your customer the top copy. File the second copy in numerical order for accounting. File the third copy in alphabetical order in your customer file along with contracts and correspondence.
Invoicing – be proud and prompt. Make your last impression as good as your first!
Eileen Reppenhagen lives in Tsawwassen, BC at 604-943-7414 or firstname.lastname@example.org Eileen coaches, trains and speaks about record keeping; taxation; cash management; budgets and planning; Quickbooks and Quicken.