It is great when work starts to roll in and our services are in demand, but forgetting to put financial processes in place can mean we end up a busy fool rather than a successful business owner. Here are some building blocks for businesses to put in place early to ensure we are getting paid quickly for our hard work.
MAKE IT EASY
Make sure your invoices include every last bit of relevant information, leave nothing to chance! Every invoice should include the following:
- The name and address of the customer.
- A unique invoice reference number.
- The date of supply (the tax point).
- A description of the goods or services provided.
- The gross amount due to be paid.
- The payment terms for this invoice and, ideally, a due date for payment.
If you run a limited company, you will need to also list the following:
· The Registered Business Address (often this is the accountants address)
· Your Company Registration Number
· Your VAT Number if your business is VAT Registered.
Most standard payment terms are 30 - 60 days from delivery. If you don’t get a contract, it is a good idea to send an email stating your terms explaining that late payment attracts interest to help deter late payment.
HOW WILL THEY PAY
Find out how your new client would like to pay. Direct electronic BACS payment is a very popular method for clients to pay. For clients to pay by BACS (bank transfer) you would need to include the following details on your invoice.
· Your Account Name
· Sort Code
· Account Number
For cheques, your business name is sufficent. Some clients may offer to pay via Paypal, however remember you will lose around 5% of the fee.
If you have put all these measures in place and you are still not getting paid, then it is time to get chasing.
If you are in the process of starting a business and would like more advice on the practicalities of setting up, FREE support is available through our Enterprise Hub programme. Get in touch with our team via 0151 706 8111 or firstname.lastname@example.org to check your eligibility or get more information.