Perfection lies in every detail. May it just be a small detail in your invoicing but that might not be the case for your client. Such negligence could actually hamper your impression in front of your clients which further could affect the business and reputation.

It might seem to you that everything is working fine as long as your clients’ are receiving invoices and you – your payments. However, they might be wishing for few minor changes to make the process more easy and understandable. These little things can lead to dissatisfied clients over a period of time though you would be receiving payments and they would still be hiring your services.

Sooner or later, it would be a loss if they decide to opt for services which seems more professional and experienced than you. Could be your immediate or far away competitor. Henceforth, it is just to make sure that your invoicing habits are telling the right things to clients and projecting a good image of your brand.

Let’s learn about the few common mistakes to be avoided which might annoy your clients:

Poor Invoice Design

Though your invoicing might be delivering exceptionally good work a poor design and an unprofessional template could drive your client to consider other services with a smart invoicing system, look, feel and more importantly overall brand identity. A poor brand design is complete an absolute no-no for any client.

Lack of Personalization

At times, invoicing could be a mundane process. It might seem time-saving to send generic invoices with only the basic set of information but at the end, it is going to leave a bad impression.

If taken in the right direction, invoicing can also further bond your brand identity and create a favorable impression. By putting a relevant data to the client’s project or a personalized message could also go a long way in continuing the long lasting business relation.

Lack of Communication & Planning

It is always suggested to do keep communication channel clear and also proper planning of the payment/billing cycle of invoices. Just sending invoices randomly and irregularly is unwelcoming to your client’s business. However, setting up a proper structure beforehand only in the terms and conditions while signing up for the services is the best way forward.

You can discuss upfront with your client whether they would prefer the invoices in the start, middle or last of the month and based on that payment cycle could be arranged to keep businesses running smoothly at both the ends. At the end of the day, you need to ensure that your solutions should ease your client’s life and not the other way round.

Incomplete Information

An experienced invoice includes all the relevant information and failing to do so can lead your client to think that you’re inexperienced. Newbie freelancers, solopreneurs tend to make small mistakes like forgetting invoice numbers, address, tax IDs, due date, deposit amount, etc. which makes it hard to understand the invoice completely. Especially if you are new to invoicing or being a freelancer, it’s always good to be accurate to create a good impression.

Lesser Payment Options

Providing only limited choices of making the payment might not be comfortable for your client and is actually frustrating. It is better to give them multiple ways of making an invoice payment. If you will not improve on your system, that might drive them to opt for other services wherein they might be getting more options of making a payment.

Moon Invoice is the easiest online invoicing app which has simplified payment with multiple options as well as to bill in any currency as per your clients’ needs.

Delayed Payment Reminders

Just as we mentioned above about sending invoices on-time, in the similar fashion so should also the late payment reminders. When the invoices are past-due then it is time to send a gentle payment reminder to your clients. Most of the clients acknowledge and make the payment immediately with delayed apologies. However, you should stay organized and send late payment reminders on-time. Ensure that you and your clients are clear in terms of automatic late payment fees and other charges.

Moon Invoice always lets you know beforehand about invoices & expenses becomes overdue. So that you can easily automate payment reminder and get paid on time.

Recurring Payments Vs Recurring Invoices

Recurring Payments	Recurring Invoices
Recurring payments charge the customer’s credit card account or debit card account on a predetermined schedule for the same amount as preapproved.	Send an invoice to your customer on a regular basis. The client receives the invoice but, money is not paid unless the customer approves.
A business that takes prepayment of money and sells a monthly subscription service and product. Subscription services are excellent examples of this.	A company that provides fixed services with billable hours is an excellent choice for recurring billing. For example law firms and consulting agencies.

Pros and Cons of Recurring Invoices

Pros	Cons
You eliminate the possibility of human error by automating the billing process. If you use a recurring invoice, you will not be concerned about forgetting to charge your customers for the things they ordered.	You must exercise caution while recurring billing to prevent issuing inaccurate pricing. This also holds for price changes that could take place right once an invoice is created.
If you provide your customers with the option for recurring billing, they are more likely to buy products regularly.	It could be difficult to cope with recurring invoices if a transaction fails for any reason.

Net 45	Invoice is due in full within 45 days with no early payment discount offered
2/10 net 45 terms	2% discount if you pay within 10 days; otherwise full payment of the invoice is due in 45 days
1/15 net 45 terms	1% discount if you pay within 15 days; otherwise full payment of the invoice is due in 45 days
1/10 net 45 terms	1% discount if you pay within 10 days; otherwise full payment of the invoice is due in 45 days
1/7 net 45 terms	1% discount if you pay within 7 days; otherwise full payment of the invoice is due in 45 days

Category	Net Method vs. Gross Method	Explanation
Calculation Approach	- Applies tax credits first; reduces taxable income before computing tax liability.	- Doesn't apply tax credits; computes taxable income without considering tax credits.
Tax Credit Eligibility	- Allows for greater likelihood of tax credit eligibility due to reduced taxable income.	- Limits tax credit eligibility because taxable income hasn't been reduced yet.
Itemized Deduction Requirement	- Lowers threshold requirement for itemizing deductions due to decreased taxable income.	- Raises threshold requirement for itemizing deductions due to higher taxable income.
Advantages	- Leads to lower taxable income and increases chances of meeting qualifications for other tax benefits.	- Results in higher taxable income compared to net method.
Disadvantages	- May miss opportunity to reduce tax burden if taxpayer doesn't itemize deductions or take advantage of tax credits.	- Increases taxable income and may result in higher overall tax bill.