Freelancers, self-employed, and independent contractors can engage in a wide variety of activities. Basically, however, businesses can be divided into two types: product- and service-based. If everything is quite clear with the receipt of payment for the first type, then some entrepreneurs, especially beginners, may have questions about the second one. In this article, we will try to tell you in detail about the features of project-based activities and the nuances of drawing up a services rendered invoice.
What Is a Service Based Business?
The term “service-based” refers to businesses that provide a variety of services to meet customer needs rather than physical products. They are sometimes also referred to as “project-based” because various tasks can be performed within a single project. The focus of such activities can be very different: legal advice, floor renovation, software development, health examination, photography, etc. Regardless of what exactly you do, a client should provide payment due when services are rendered.
Of course, as in any other business, you want to receive timely compensation for your work. In exchange for a completed order, you should send a customer a receipt for services rendered. Since different projects have various stages and tasks, it is important for freelancers and self-employed to maintain flexibility in work and preparation of payment documents. The Saldoinvoice templates can be customized depending on the specifics of a particular job or client.
How to Invoice for Services?
Billing orderers for completed projects is as easy as for the goods provided if you know how to do it correctly. What is a service invoice? It is an accounting paper that is used to claim compensation for rendered professional services. It should be clearly structured like product bills and contain detailed information about both sides and the work performed.
When you supply physical items, there are no questions about filling out such receipts. You just list all the products and their prices. With services, the situation is somewhat different. As an entrepreneur, you can decide for yourself whether you would like to receive an hourly wage or assign a fixed cost per project. As a rule, many freelancers prefer hourly compensation since tasks can vary in complexity, which means that the time spent on their completion will be different. If you’re still an aspiring entrepreneur, check out sample invoices for services to understand what is considered the standard in your industry.
What to Put in an Invoice?
An invoice is a formal request for payment in exchange for a service provided. It should look professional and contain all information about a provider, client, and tasks performed.
How to write an invoice for services rendered? Depending on the accounting software you use, the appearance of documents may differ slightly, but as a rule, they all have basic unchanged fields. Usually, payment papers consist of the following information:
- a title, creation date, due date (payment terms), and file ID;
- your business details and company logo, if any;
- information about a customer;
- a complete list of services provided within a project, indicating the cost of the time spent on their execution and tax (if applicable);
- payment options and instructions to help a client make payment faster;
- discount and shipping data and total sum due.
Not sure how to fill out a form correctly? Check out the example of an invoice for services rendered. Our templates are flexible tools that you can customize as you see fit. If, as part of a project, you not only provided services with an hourly rate but delivered physical items at a fixed cost, you can also include them in your document to get paid for everything you did for an orderer.