Still preparing invoices manually? You can take the pain out of the process—and even get paid faster—with invoice software. Here’s what to look for when choosing invoice software for your small business.
Why you need invoice software
When you become self-employed, your clients cannot compensate you until you invoice them. This means you need send your payment request to each client with enough lead time to get paid by a desired date.
If you have one client, the invoicing process may sound easy enough to manage on your own. But what if you had five, ten or even one hundred clients? This is where invoice software offers advantages over manual invoice preparation.
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Save time and get paid faster
Do you manually create invoices in a word processing tool or spreadsheet? You are likely losing valuable time fussing with invoice formatting, hunting down client email or postal addresses and emailing or snail-mailing invoices. Invoice software lets you fill invoice templates, save client contacts and send invoices with the push of a button. The faster you can send an invoice, the faster you can get paid.
Increase accuracy
Even diligent business owners can make math mistakes when figuring invoice amounts manually. Invoice software gives you the peace of mind that neither you nor your client will get short changed because of an incorrect invoice amount.
Look professional
The presentation of your invoice is as important as the accuracy of the payment terms. Invoice software allows you to create and send custom invoice templates with your business logo. The polished look of your invoice will lend credibility to your business as a whole.
What to Consider in Invoice Software
Cost
Determine a budget for invoice software based on the size of your client base. Many popular invoice software providers offer free trials or free accounts. Harvest, for example, offers a free account option and paid options for as little as $10.80 per month. FreshBooks also offers free trials along with accounts starting at $15 per month. For freelancers, Bonsai offers an alternative with its $9 per month plan including invoicing, time tracking and payments.
Remember to include payment transactions fees in your budget. The free digital wallet Due, for example, imposes a 2.8 percent fee for credit card transactions.
Feature-rich invoice template
At minimum, the invoice templates within your invoice software should include:
- Payee contact information
- Payer contact information
- Project details
- Payment amount due
- Invoice date
- Payment deadline
- Late payment terms
Make sure that the invoice templates meet the needs of your project and billing preferences. If you work on retainer, consider Harvest’s retainer invoicing option. Do you need to charge a client sales tax? Look into FreshBooks, which allows you to save and reuse taxes.
Need to brand your invoice? Zoho offers a gallery of pre-designed invoice templates you can customize. If you need more fully-featured accounting software that includes invoicing, look into Xero.
Ease of use
Look for a sleek interface with intuitive options for electronic invoice submission. For recurring invoices to repeat clients, look into Harvest and FreshBooks. Similarly, Xero makes it easy to send invoice right from your iPhone or Android device.
After sending an invoice, FreshBooks or Harvest can send payment reminders to your client. You can also see in the interface whether a client has viewed your invoice. This means you never again have to worry whether a client has received your invoice.
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Manasa Reddigari
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MileIQ’s blog does not constitute professional tax advice. You should contact your own tax professional to discuss your situation.
