Invoicing & Payments

An invoice is the document that starts a payment clock, and most of what goes wrong with getting paid is decided before it is sent.

Start with what the law asks for. What a UK invoice must legally include walks through the nine elements GOV.UK requires and where each one sits on the page; if you are VAT registered, a VAT invoice has to carry more. Neither takes long to get right. A vague line description is what gives a slow payer somewhere to hide.

Still choosing a tool? The invoicing software comparison weighs the dedicated apps against full accounting software, and the FreshBooks review covers what a US-built tool actually costs a UK sole trader.

Then the part nobody enjoys. Unless you agree a date, the customer has 30 days from receiving the invoice or the work, whichever came first. After that the debt is late, and statutory interest of 8% above the Bank of England base rate — 11.75% today — plus £40 to £100 per invoice applies automatically, whether you ask for it or not. The chasing playbook sets out the order to do things in. There is also an outside limit: six years under the Limitation Act 1980, after which the debt cannot be enforced at all.

Money that arrives in stages needs its own paperwork. A deposit is a payment like any other and gets its own invoice with its own number — and if you are VAT registered, it creates a tax point the day it lands, refundable or not. A client who pays the same amount every month is a different arrangement again, with a numbering trap that catches people on recurring invoices. And if any of it is coming by card, the processor’s cut is not something you can add to a consumer’s invoice — surcharging a consumer for a normal card has been unlawful since 2018.

One change is coming. The Commercial Payments Bill would cap commercial payment terms at 60 days and stop a contract overriding your right to statutory interest. It is not law yet — here is what it changes and where it has got to.

Figures checked 26 August 2026.