What you need to know about invoice payments

Key points

• An invoice is a document that notifies your customers when payment is due for the goods or services you provided.
• You can use accounting software to create an invoice or do it yourself with a template.
• There is information you’re legally obliged to include on all tax invoices to meet the requirements of the Australian Tax Office (ATO).

An invoice payment is the payment you’ll receive after you send an invoice to a customer. An invoice is a document that lists the goods or services the customer purchased, how much they owe you and how they can pay you.

We’re going to cover some invoicing basics so you can get paid correctly and on time.

How to set up and send an invoice

There are two main methods for setting up and sending invoices. You can send an invoice to request payment via accounting software or use an invoice template and send it yourself.

Whichever way you go, it’s important to review the invoice before sending it. The wrong total amount, a misspelt email address, or incorrect account number could mean you don’t get paid on time, or at all.

1. Use accounting software

Accounting software is an efficient way to set up and send invoices because it can:

• Autofill the information on the invoice, such as what the customer bought and the quantity, saving you precious time.
• Develop accurate invoices and reduce the likelihood of errors.
• Keep track of when invoices are sent and due.
• Help you keep track of inventory.
• Help you get a clear view of your finances with reporting and expense tracking.
• Automatically calculate tax and other information such as discounts.

ANZ customers get discounted access to MYOB accounting software subscriptions that include invoicing functions. Access offer below:

• MYOB

2. Find an invoice template and send it yourself

You can easily find free invoice templates online. With an invoice template, you can customise the design and incorporate your business’ branding.

Take a look at these free invoicing templates below:

• Canva
• Adobe
• Microsoft

You can also use these templates as a guide for designing your own. Add branding or keep it plain and simple – whatever works for your business and gets you paid.

As you’re manually entering information, it’s important to check the invoice before you send it to the customer.

Information you need to include on your invoice

The Australian Tax Office (ATO) specifies mandatory requirements that you need to include on your invoice:

• The words ‘tax invoice’ need to be clearly displayed.
• Your business name and Australian Business Number (ABN) or Australian Company Number (ACN).
• The date the invoice was sent to the buyer.
• The goods and services tax (GST) amount, either for each line item or as a whole. You can use the Moneysmart GST calculator to work out how much to charge your customers.

If the sale is over $1,000, you’ll need to include the buyer’s information, such as:

• The name of the person or business – include their ABN or ACN if it’s a business.
• Their contact information, such as their postal and email address and phone number.

It’s not an ATO requirement but it may help to also include these details on invoices under $1,000.

Additional information to get paid faster

Getting paid correctly and quickly can help maintain cash flow – who doesn’t love payday? Here is some additional information you can add to your invoice to speed up the payment process:

• Payment terms – the number of days before the payment is due or the final payment date. Common time frames for invoice payments include 14 days, 30 days, 60 days or 90 days. With cash flow in mind, choose the payment terms that make sense for your business.
• The invoice number and the customer’s purchase order (PO) number. These are unique numbers that can help you identify the customer, date or job number associated with the purchase.
• Payment method, such as direct debit, BPAY, Visa or Mastercard. Make the instructions as simple as possible and provide a contactable number or email so your customers can get in touch if they have any issues with payment.

Some of this information will be automatically included on the invoice if you’re using accounting software. If not, make sure you add it to the invoice yourself.

Other ways to get paid:

Invoicing is just one way to get paid. If you operate a business such as a retail store or restaurant, you might need a point-of-sale (POS) system. That’s where ANZ Worldline can also help with EFTPOS terminals and tap on mobile.

Next steps

Invoices are a great way to help you manage cash flow. If you want to learn how to maximise your cash flow or want steps to forecast it, download our cash flow checklist.