A clear invoice gets you paid faster. This guide covers what an invoice must include, the extra rules for VAT, and simple ways to reduce late payment.
Published July 2026 · Updated July 2026
A valid invoice shows a unique invoice number, your business name and address, the customer's details, a description of what you supplied, the date, and the amount due with payment terms. If you are VAT registered, add your VAT number, the rate, and the VAT amount.
VAT-registered businesses issue VAT invoices so customers can reclaim the VAT. Show the net amount, the VAT, and the gross total clearly. The rate depends on what you sell, usually 20%.
Set a clear due date, offer easy payment options, and send the invoice promptly. Friendly, systematic follow-up on overdue invoices makes a big difference to cash flow.
Keep an eye on which invoices are unpaid and how overdue they are. Software shows this at a glance so you can chase before a small delay becomes a cash problem.
A £500 job, VAT registered:
Only if you are VAT registered. If you are, most invoices show 20% VAT, though the rate depends on what you sell.
A draft or quote sent before the sale is confirmed. It is not a demand for payment and is not a valid VAT invoice.
Send polite reminders on a schedule, make paying easy, and consider clear terms or late-payment charges. See our guide on chasing late payers.
This guide is general information for UK small business owners, not accounting, tax or legal advice. Rules, rates and thresholds reflect 2026/27 and change over time; always check the linked official source or a qualified adviser for your situation.