Freelancers are in a unique position. You can choose how much to work and when, but the downside is that you have to handle things like invoicing on your own. If you’re not billing through an agency, how do you go about handling invoices? Here are some tips for freelancers to invoice without a company.
1. Find a freelancer to help you with invoices
It is a good idea to find a freelancer to help you with invoices. For example, there are freelancers on Upwork who will create an invoice for you if you have the payment information and how much you charge.
2. Create templates for how your invoices should look
Freelancers often wonder what a professional invoice should look like. I work with clients that need professional invoices to be created and then send out to their clients. I create templates for my invoices that include the following items:
a). Professional logo
b). Professional letterhead
c). Professional address
d). Professional invoice details (e.g., unique invoice number, invoice date)
e.) Professional contact information (e.g., email address)
f). Professional signature line, and
g). Services offered
h). Goods and services tax
Typically, these templates will already have been set up. However, you can modify them as needed according to your company’s requirements. Invoice templates are typically available for free online.
3. Establish how often you will send out an invoice
Freelancers send invoices to clients for the work they have done. It is a good idea to establish how often you will send out invoices so that your client knows how often they can expect a bill.
The frequency of your invoicing will also depend on how many clients you have and how much money you want to make from each job.
If you’re not sure how often to invoice, it is advisable to do it every time after the client receives the work, instead of waiting for a certain number of days or weeks.
You may also want to consider how much money you need upfront from the client before starting any work with them.
For example, if you need $500 upfront for an article writing project, you could invoice your client $500 at the beginning of the project and then every time after that when they receive a draft.
4. Address any issues that arise when handling the invoices yourself
Late Payments
Making sure that your invoices are paid on time is paramount. This is especially true for freelancers, because – unlike business owners – they don’t have employees to process invoices. The best way to handle late payments is to be proactive and include penalties for late payments in the terms of the contract. This will help reduce pressure on you (and your bank account) by ensuring that you get your money before it’s due.
Related: 9 Reasons Your Business Needs Invoices
Disputed Charges
It is sometimes possible for a client or customer to dispute a charge on their invoice. When this happens, you’ll need to work with them directly to resolve the issue. If you’re not able to agree, it might be necessary to contact your legal counsel and/or an accountant to help you.
Disputed charges can be a pain, but the best thing that you can do is stay calm and work with your customer or client until both of you are satisfied with the solution. The number one priority should always be to maintain good relationships with people throughout your business interactions – this will pay off in the long run!
Paper Trail
Don’t Forget to Include a Paper Trail If you’re going to be handling invoices yourself, you must have a record of all transactions. This means sending email confirmations after each transaction and keeping track of them in an organized folder – whether on your computer or in a filing cabinet at home. Since you’re likely to be working with multiple clients, everything must be well documented so there are no disputes later on.
Taxes
Make sure you get an Employer Identification Number (EIN) for your business – especially if you plan on hiring employees in the future. You’ll need it to file your taxes. Also, make sure that you keep track of how much money goes into your personal and business accounts – this will help when tax season comes around!
Insurance
As a freelancer or small business owner without an office, insurance can be expensive but making sure to get the right coverage is imperative. Things to consider: Property and Equipment Insurance, General Liability Insurance, Business Auto/Vehicle Insurance and Professional Liability (Errors & Omissions)Insurance.
Related: 7 Must-Listen Startup Podcasts
5. Keeping track of expenses and how they impact your finances weekly
Freelancers and business owners who don’t have a company will need to use personal finances to cover expenses such as invoices. The first step for this is to keep track of how much money you spend and how it impacts your finances weekly. For example, how many hours did you work? How much did you pay for your invoices? Did you get paid and how much did the total come out to?
6. Keep track of time spent
The first thing that you need to do is keep track of how long it takes to complete each task or project for which you will be charging. This way, once the invoice has been sent off, there won’t be any question as to how much time was put into each project. It also helps with estimating how many hours should be billed in the future.
Related: 10 Mistakes to Avoid with Freelance Email Marketing
7. Another option freelancers have is using software like Chiggopay
Another option freelancers have is using software like Chiggopay, which automatically sends out invoices when work is completed. This allows them to keep all of their financial information in one place and not have to worry about how they are going to invoice for their work if they don’t have a company.
8. Freelancers should create a spreadsheet with all their invoices and how much they owe on each one
Freelancers should create a spreadsheet with all their invoices and how much they owe on each one. They should also identify how long it will take them to pay back the invoice in full based on how many hours they work each week. This way, they can make sure to make payments on time if possible.
9. Make sure you follow up on late payments
You need to make sure to send payment reminders and invoices 10 days before the due date. One way to follow up with customers who are late in paying your invoice is by sending them a polite email (e-mail) reminding them that they owe you money and that their invoice will be cancelled if payment is not received by the invoice due date. The email should also include information about how much interest they will be charged if their invoice is past due.
Related: Do Freelancers Have Entrepreneurial Skills?
Final Thoughts
Freelancers are often faced with the challenge of how to handle invoices without a company. This article has provided some helpful tips on how freelancers can get paid for their work, even if they don’t have an incorporated company or business name.
Freelancers should also consider getting liability insurance coverage in case there are any accidents while working at the client’s location and need protection from lawsuits. These tips will help ensure that your freelancing career is successful!
