How to Send an Invoice: Complete UK Guide for Small Businesses (2026)

So, you know the drill – consistent cash flow keeps the wheels turning for small businesses. And that’s why diving into the world of invoicing matters. It’s all about ensuring those payments roll in smoothly.

Now, we get it, invoices can feel like a bit of a maze, especially if you’re just getting the hang of them. So we're here to give you the 411 on how to send an invoice. In this complete guide, we’ll cover:

• Why we send invoices
• Making Tax Digital and invoicing
• Information needed on an invoice
• How to make your own invoice
• Types of invoices
• Invoice template
• VAT invoicing
• Invoice payment terms
• How do you send an invoice out?
• Communicating with customers about invoicing
• How to send an invoice email
• Invoice software recommendations

Feel free to jump ahead using the links above if you’re curious about the nitty-gritty – like whether to use snail mail or email your invoices, speeding up those payments, or handling those late-paying customers.

Alright, let’s kick things off with the basics, shall we?

Why exactly do we bother sending invoices?

Think of an invoice as the official record keeper of a sale. It's not just a piece of paper or an email – it's a crucial document that ensures both you and your customer have a clear record of the transaction.

Now, what's usually in this document? You've got your itemised list of what was bought or done, complete with prices. Plus, it's got all the necessary info about who's sending it and who's receiving it.

When that invoice hits your customer's inbox or mailbox, it's like sealing the deal officially. This documentation is handy for your own bookkeeping and also key for your customers to keep track of what they've bought.

Making Tax Digital (MTD) and Invoicing

As of April 2026, sole traders with income over £50,000 must keep digital records and submit quarterly updates to HMRC using MTD-compatible software. This means invoicing is no longer just about getting paid; it is now part of tax compliance for a growing number of UK businesses.

These MTD quarterly updates are not extra tax returns, but from April 2026 those eligible need to use recognised software to keep digital records and send HMRC these light-touch updates of their income and expenses. The rules are being phased in based on qualifying income: businesses earning over £50,000 must comply from 6 April 2026, those over £30,000 from 6 April 2027, and those over £20,000 from 6 April 2028. You can check whether and when you need to sign up on the GOV.UK guidance page.

Once your business qualifies, manual invoicing might start to create friction, since every invoice needs to feed into a digital record your software can report from, so digital invoicing tools are now recommended for anyone approaching the thresholds and required for anyone already past them. Xero, QuickBooks, and Sage are compatible with MTD for Income Tax and covers invoicing alongside the record keeping HMRC requires. If you're already using Epos Now, your sales data can sync straight into your accounting software through our Xero and QuickBooks integrations, keeping invoicing and MTD reporting in the same loop rather than as two separate jobs!

What should you put on your invoice?

First things first, make it super easy for your customers to pay up. Toss in those bank account details if you're rolling with online banking. And if you're all about that PayPal life, slap on a link so your customers can just click and pay in a jiffy.

Now, when it comes to setting your payment terms, clarity is key. Lay them out nice and clear – it's gonna make a big difference in how fast those payments roll in.

Information needed in an invoice

Including the following information will help guarantee that your accounts receivable (AR) processes and your client or customers’ accounts payable (AP) processes:

• Invoice number: It's like the ID for your invoice – your invoice number helps everyone keep track.
• Your business's name and address: So they know who to thank (or blame) for the bill.
• Client or customer's name and address: Can't forget who's footing the bill.
• Date of the invoice: When you officially sent out the payment request.
• Due date: When you expect that cash to hit your pocket.
• Description and quantities of goods: So they know exactly what they're paying for.
• Sales tax payable: The government's cut, gotta include it.
• Total amount payable: The grand total they owe you.
• Payment terms: Lay 'em out clearly so there's no confusion on when the money's due.

Make sure to nail down those payment terms – it's gonna be a game-changer in how swiftly those payments roll in.

How to make your own invoice

Before we teach you how to send an invoice, let's look at how you can make one. The method you use depends on what tools and systems you've already got in place. Here are some common ways businesses go about it:

Creating an invoice manually

If you're just starting out or don't send many invoices yet, manual processes might be your go-to. Here's how to do it:

• Create a new document: Open up your word processing software like Microsoft Word or Google Docs. They usually have templates, so you don’t have to start from scratch.
• Enter the deets: Fill in the necessary transaction info. That's your customer’s contact info, what they're buying, how much they owe, and all that jazz. (Check the previous section for the lowdown on what to include.)
• Save and export: Once you've got everything in there, save it and export it as a PDF. PDFs are easy to share and print, and less likely to get messed with accidentally.
• Send it out: Now comes the fun part – sending that invoice off into the world. You can either print it out and pop it in the mail, or sling it over via email or SMS as an attachment.

And there you have it! A good ol' fashioned manual invoice ready to roll.

Generating invoices using invoicing software

Looking to streamline your invoicing process? Using dedicated invoicing software can be a game-changer. Here's how you can do this:

• Launch your invoicing software: Whether it's a dedicated tool like Sage Business Cloud or part of your existing payment or accounting solution like Paypal invoicing or QuickBooks, get that software fired up.
• Fill in the blanks: Your invoicing software will guide you through filling out the necessary fields, making it easier than ever to enter all the transaction details, including the invoice number, payment details, and invoice date.
• Send it off: Once your invoice is ready, you can choose to print, export, or even send it directly from the software itself. Need to include payment reminders or set up payment terms? Many invoicing software options have features for that too!

With invoicing software, you can create invoices with ease, accept online payments, and even send payment reminders to ensure you get paid faster. It's the ultimate solution for small businesses looking to manage their cash flow efficiently.

Types of Invoices

Not every invoice does the same job, so here are the most common ones and when you might want to use them:

• Standard/sales invoice. The everyday invoice sent after goods or services have been delivered, requesting payment by a set due date. This is the one most businesses send on an everyday basis.
• Pro forma invoice. You send a pro forma as an estimate of costs before work is done or goods are delivered. It's not a demand for payment and doesn't count as a formal invoice for tax purposes, but it's useful for confirming details upfront.
• VAT invoice. A standard invoice with the extra details needed for VAT-registered businesses, including your VAT number, the VAT rate applied, and the amount of VAT charged.
• Credit note. Credit notes reduce or cancel out an invoice you already sent that now needs a refund, discount, or correction applied.
• Interim invoice. Used for larger projects billed in stages, this covers a portion of the total cost for work completed so far, rather than waiting until everything is finished.
• Final invoice. Often following interim invoices or pro formas, a final invoice is sent once a project is completed, and covers any outstanding payments.
• Recurring invoice. Sent automatically at set intervals (weekly or monthly, for example) for ongoing services or subscriptions, so you don't need to raise a fresh invoice each time.

VAT Invoicing

If both you and your customer are VAT registered, you'll need to issue a VAT invoice rather than a standard one. A VAT invoice includes everything a normal invoice has, but it also has your VAT registration number, the VAT rate applied, and the amount of VAT charged on top of the net total.

The current VAT registration threshold is £90,000 in taxable turnover over any rolling 12-month period, which was last updated in April 2024. Once registered, you'll also need to comply with Making Tax Digital for VAT, which discussed earlier, as that has been mandatory for all VAT-registered businesses since 2022 (regardless of turnover).

If you're not VAT registered, don't mention VAT anywhere on your invoice, including the rate or amount, as this implies a registration you don't have.

Invoice Payment Terms

Payment terms tell your customer exactly when payment is due, and giving your clients the right length of time, and displaying this clearly on your invoice, makes a real difference to your cash flow. The most common terms used by UK businesses are "Due on Receipt" (which means the payment is expected immediately), Net 7, Net 14, and Net 30, with the number referring to the days after the invoice date that payment is due.

The payment window that suits your business depends on factors like your cash flow needs, your industry norms, and the size and reliability of your customers. Freelancers and small suppliers often prefer shorter terms like Net 7 or Net 14 to keep cash flowing, while larger contracts or established B2B relationships more commonly default to Net 30.

Net 30 is the standard many UK businesses use by default, but it isn't a legal requirement, so you're free to set whatever terms work for you, but it's essential whichever terms you choose are clearly stated on the invoice.

If a customer pays late, the Late Payment of Commercial Debts (Interest) Act gives you the right to charge statutory interest, currently set at 8% above the Bank of England base rate, though if the debt is large enough, you can also add a fixed compensation fee. I's also important to note that if you're invoicing another business, the interest and compensation fee can apply automatically even if you didn't mention it on the invoice, though a lot of businesses reference it anyway, just so your customers know you'll enforce it.

How do you send an invoice out?

When it comes to learning how to send an invoice, there are various methods to choose from. Let's explore some popular options:

Invoice email

Sending invoices via email is personal, efficient, and a common practice in today's business world. With just a few clicks using invoicing software, you're able to craft polished, professional invoices.

But here's where the human touch comes in. When you hit that send button, it's not just about firing off an invoice into cyberspace. It's about customising the subject line, making it warm and inviting. Maybe it's a simple "Your Invoice for [Month]" or a friendly "Hey [Client's Name], Your Invoice Inside!" – something that catches their eye and makes them want to open it.

And inside that email? It's not just a list of numbers and figures. It's your chance to communicate with your client. Sure, you've got the invoice number and payment terms, but you also slip in a quick note, reminding them of the value they've received and gently nudging them toward prompt payment. It's about building a relationship, not just chasing payments.

So, next time you're sending out an invoice via email, remember to inject a little humanity into it.

Via invoicing software

With invoicing software, managing your finances becomes a breeze. Accounting solutions like Xero or QuickBooks (which can both be integrated into your Epos Now POS system) take the hassle out of invoicing by automating the entire process for you.

You just need to create your invoice once, customise it to your heart's content, and then let the software handle the rest. It'll automatically generate invoice numbers, populate client details, and even calculate taxes and totals. No more manual data entry or number crunching on your end.

But that's not all! With invoicing software seamlessly integrated into your POS system, you can track payments, monitor outstanding invoices, and even send payment reminders with just a few clicks.

Through a payment provider like Epos Now Payments

Managing your invoices takes on a whole new level of efficiency and convenience when you use a payment provider.

You can create your invoice within Epos Now's POS system, tailored to your specific needs and branding. With just a few clicks, you can add line items, set payment terms, and even customise the invoice template to reflect your business's unique style.

Here's where the magic happens: Epos Now not only enables you to create professional invoices but also allows you to accept payments directly through the platform. Whether it's online payments, credit card transactions, or even contactless payments, Epos Now provides a variety of payment options to suit your customers' preferences.

With Epos Now's integrated invoicing and payment system, you can track payment status in real-time, automatically reconcile payments with invoices, and even send payment reminders to ensure timely settlements. It's like having your own dedicated finance team working around the clock to streamline your invoicing process.

Send invoices by post

Sending invoices by post might seem old-school in today's digital age, but it's still a preferred method for some businesses and clients. Here's why:

• Tangible presence: A physical invoice can serve as a tangible reminder of the transaction, sitting on your client's desk until it's paid. It's harder to ignore compared to an email buried in an inbox.
• Personal touch: Invoices sent by post can convey a personal touch that digital invoices may lack. Adding a handwritten note or including branded stationery can leave a lasting impression on your client.
• Client preference: Some clients, especially those in certain industries or demographics, may prefer receiving invoices by mail. It's familiar and comfortable for them, which can help streamline the payment process.
• Legal requirements: In some jurisdictions or industries, physical invoices may be required for legal or compliance reasons. When discussing how to send an invoice by post, you need to ensure you're meeting all necessary regulations.

However, it's essential to consider the potential downsides of sending invoices by post, such as longer delivery times, higher costs, and environmental impact. It's often a good idea to offer multiple invoicing options to accommodate different client preferences and needs.

Communicating with customers about invoices

Preparing and sending out your invoices is just the beginning of the journey. Think of it as planting the seed – now you've got to nurture it to ensure it grows into a healthy cash flow.

But here's the thing: Just sending out invoices doesn't guarantee prompt payment. Fear not! There's plenty you can do to expedite the process and foster consistent payments. It's all about proactive communication and setting clear expectations.

Explain your payment terms clearly

One key aspect is to ensure that your payment terms are crystal clear to your customers. Include invoice details such as the due date, late payment fees, and consequences of late payments. By laying out these terms upfront, you set clear expectations and minimise misunderstandings.

Offer a number of different payment methods

Another strategy is to provide flexibility by offering various payment methods. Whether it's online payments, credit card transactions, or bank transfers, giving your customers options can make it easier for them to settle their invoices promptly.

Understand any payment challenges

Be proactive in understanding your customers' payment difficulties. If they're experiencing financial challenges, consider offering payment plans or alternative arrangements to accommodate their needs while ensuring you still receive timely payments.

Be timely with your responses

When your customers have inquiries or concerns about invoices, be prompt in your responses. Clear communication and quick resolution of issues help prevent payment delays and maintain a positive relationship with your customers.

How to talk to your customers about invoices

Preparing your invoices and sending them out is only half the battle. It doesn’t guarantee you will get paid on time. Don’t worry, there are still many things you can do to speed up cash flow and encourage more stable payments.

Explain payment terms clearly

One key aspect is to ensure that your payment terms are crystal clear to your customers. Include invoice details such as the due date, late payment fees, and consequences of late payments. By laying out these terms upfront, you set clear expectations and minimise misunderstandings.

Offer different payment methods

Another strategy is to provide flexibility by offering various payment methods. Whether it's online payments, credit card transactions, or bank transfers, giving your customers options can make it easier for them to settle their invoices promptly.

Understand any payment difficulties

Be proactive in understanding your customers' payment difficulties. If they're experiencing financial challenges, consider offering payment plans or alternative arrangements to accommodate their needs while ensuring you still receive timely payments.

Be timely with your responses

When your customers have inquiries or concerns about invoices, be prompt in your responses. Clear communication and quick resolution of issues help prevent payment delays and maintain a positive relationship with your customers.

Consider the customer’s past record

Take into account your customer's payment history and track record. If they've consistently paid on time in the past, you can be more lenient with payment terms. However, if there are recurring late payments or payment disputes, it may be necessary to adjust your approach accordingly.

Know when it's time to cut your losses

Unfortunately, some customers may repeatedly fail to pay their invoices despite your best efforts. In such cases, you must recognize when it's time to cut your losses and take appropriate action, whether it's pursuing legal avenues or discontinuing services.

By implementing these strategies and maintaining open communication with your customers, you can improve cash flow, minimise late payments, and foster stronger relationships with your clients.

How to chase an overdue invoice

• Send a payment reminder shortly before the due date (roughly one week before if your invoice is Net 30), and follow this up with a short reminder on the due date itself, and a firmer follow up one week after if payment still hasn't landed.
• Be polite but firm in your reminders, keeping it professional rather than apologetic. Reference the invoice number, amount, and due date directly so they know what you're referring to. Ask for a clear update and avoid being vague.
• Know when to escalate to a formal letter before further action: If there's still no payment two to three weeks after the due date, send a final letter before you take action. This should restate the amount owed and original terms, and give a clear deadline, commonly 7 to 14 days, before you take further action.
• Know your rights under late payment law: Under the Late Payment of Commercial Debts Act, you're entitled to charge statutory interest, currently 8% above the Bank of England base rate, plus a fixed compensation fee to other businesses, even if you didn't mention this on the original invoice.
• Take the customer to small claims court as a last resort: If the invoice remains unpaid after the final letter, small claims court is a realistic option for debts up to £10,000 in England and Wales. The small claims court is designed to be manageable without a solicitor, but you should only turn to them after reminders and formal escalation have failed.

Invoicing Software Recommendations

If you're ready to move away from manual invoicing, UK businesses are well served by tools like Xero, QuickBooks, and Sage, all of which handle invoicing alongside broader bookkeeping and MTD-compatible record keeping.

If you're already running Epos Now as your POS system, it integrates directly with Sage, Xero  and QuickBooks, so your sales data flows straight into your accounting software without manual re-entry.

Final thoughts

So there you have it! Our complete guide to how to send an invoice, complete with tips and tricks that you can use for your small business.

Mastering the art of invoicing is crucial for the success of any business. From understanding the importance of invoices to crafting the perfect one, from choosing the right invoicing method to navigating payment conversations with customers, there's a lot to consider.

But, with the right tools and strategies, you can streamline your invoicing process and optimise your cash flow. Whether you're leveraging invoicing software, sending invoices via email, or utilising a POS system like Epos Now, there are plenty of options available to make invoicing a breeze.

By setting clear payment terms, offering various payment methods, and being proactive in addressing payment challenges, you can expedite payments and foster stronger relationships with your customers. And remember, timely communication and knowing when to take action are key to maintaining a healthy cash flow.

So, whether you're just starting out or looking to level up your invoicing game, take the time to explore your options and find the best approach for your business. With a solid invoicing strategy in place, you'll be well on your way to financial success.

Enjoy this blog? Why not read some of our other handy guides:

• What is a credit note?
• What are invoice payment terms?
• What is a cash float?
• How to automate your business