Last editedMay 20222 min read
The basic approach to creating a carpenter invoice is the same, regardless of how you operate. That said, there are usually certain differences based on the specifics of your company and the job. These are very straightforward to navigate, so here are some tips to help.
Think about your structure
When you create a carpenter invoice, there are two key questions you need to answer. Firstly, are you registered for VAT? If you are, you will need to ensure your carpenter invoices contain all the data items required by HMRC.
Secondly, are you operating as a limited company or a sole trader? If you’re operating as a limited company, your branding and other details should relate to your company rather than yourself. If you run a limited company, you're probably of a size where using accounting software to manage your invoices would benefit you.
Your branding and other details should generally reflect you if you're operating as a sole trader. An exception might be if you’re working as part of a franchise brand. If you’re working as a sole trader, you may be OK basing your invoices on a standard template. If necessary, you can adapt it to suit your needs.
Format your carpenter invoice so it’s easy to read
There is no legally mandated format for creating carpenter invoices. There are, however, a few standard conventions. Start with the details of the payee and payer and specific details relating to the invoice itself, such as its number. Next, describe what you did and conclude with payment terms (and a thank-you/acknowledgement).
Contact details for a carpenter invoice
Although it’s the 21st century, you need to include physical contact details for both yourself and the payer. This is required to establish the validity of the connection between yourself and the payer. It’s also advisable to include email and phone/Skype details.
Detailing the work done on your carpentry invoice
This is where a carpenter invoice can differ significantly from most other forms of invoices. There are multiple different ways carpenters can bill their work. For example, if you’re working on a construction project, you may simply bill your client an hourly rate. A purchase order may cover this, although this is variable. Alternatively, you may bill your client with a combination of an hourly rate plus materials.
Another possibility is that you’re contracted for a specific, custom build. In that case, you might simply bill your client for the entire job. You may also wish to request a deposit and potentially split your bill into instalments, payable as you reach certain milestones. Regardless of which approach you use, you need to set out clearly what the payment is for.
Setting out your payment terms
There are two ways you can approach setting out payment terms. Firstly, you can use payment methods that require the customer to action the payment and give them a deadline by which to do so. Secondly, you can use direct debits and set up the payment yourself. The customer does need to give you an initial authorisation, but that is all they need to do.
Using direct debits used to be too expensive and complicated to be a feasible option for small businesses, let alone freelancers. Now, however, thanks to GoCardless, taking direct debits is simple. It’s much more cost-effective than taking card payments or using e-wallets and more secure than giving out your bank details to receive transfers.
We can help
GoCardless is a global payments solution that helps you automate payment collection, cutting down on the amount of financial admin your team needs to deal with. Find out how GoCardless can help you with one-off or recurring payments.