How to create an invoice
- Fill in Your business (name, address, phone, email and an optional tax ID) and Bill to (client name, address and email).
- Under Invoice details, check the Invoice number, pick the Currency and Invoice date, then choose Payment terms. The Due date follows the terms, or you can set your own.
- In Line items, describe each product or service with Qty and Unit price. Two example rows are filled in, so replace them and use Add line item for more.
- Enter any Discount (percent or fixed amount), Tax rate (%) and Shipping or other fees, and add payment instructions under Notes.
- Select Save as PDF or print and choose Save as PDF in the print window.
How the totals are calculated
Each line amount is Qty times Unit price, rounded to the smallest unit of the currency (cents, or whole yen for JPY). The steps then run in this order:
- Subtotal = the sum of the line amounts.
- Discount = a percent of the subtotal, or a fixed amount, never more than the subtotal.
- Tax = tax rate times (subtotal minus discount).
- Total due = subtotal minus discount plus tax plus shipping.
Rounding each line first means the amounts printed on the invoice always add up to the total.
Worked example
With the defaults, "Website design (hours)" is 10 x $75.00 = $750.00 and "Domain and hosting setup" is 1 x $250.00 = $250.00, so the Subtotal and the Total due are both $1,000.00, shown above the preview as "Total due: $1,000.00". Enter a 10% Discount, a 7% Tax rate and $20 Shipping, and the invoice lists Discount (10%) -$100.00, Tax (7%) $63.00 (7% of $900.00), Shipping $20.00 and Total due $983.00. For the tax rate, use the Sales Tax Calculator; to check a percentage discount, use the Discount Calculator.
Limits and edge cases
- Numbers can be typed as 1250.50, 1,250.50 or 1.250,50. A lone 1.250 is ambiguous (1250 or 1.25), so the price, shipping and fixed discount fields refuse it. Negative numbers are refused, so use the Discount field for credits.
- A field marked in red stops Save as PDF or print until you fix it.
- An invoice has one tax rate. For two rates, enter the tax as separate line items.
- Nothing is saved between visits. For a till-style paid record use the Receipt Generator, and for payment advice read our freelancer invoice guide.
- This is not legal or tax advice. Required details vary by country: see the GOV.UK rules for UK VAT, and check your state's sales tax rules in the US.
Frequently asked questions
What should an invoice include?
Your business name and contact details, the client's name and address, a unique invoice number, the invoice date and due date, each item with quantity and unit price, the subtotal, any discount and tax, the total due, and payment terms. Add your tax ID or VAT number if your country or state requires it.
How do I save the invoice as a PDF?
Select Save as PDF or print, then choose Save as PDF (or Microsoft Print to PDF) as the destination in the print window and confirm. The suggested file name is Invoice plus the invoice number, for example Invoice INV-202610-001.pdf. Switch off Headers and footers in the print options if you do not want them.
Is tax calculated before or after the discount?
After. The tool subtracts the discount from the subtotal first and then applies the tax rate to what is left. Shipping and other fees are added afterward and are not taxed, so if your state taxes shipping, enter it as a line item instead.
How should I number my invoices?
Use a unique number for each invoice, in order. The tool suggests a number such as INV-202610-001, made of the year, the month and a counter. Change the counter for each new invoice, because the tool does not remember your last number.
Can I save the invoice and edit it later?
No. The generator has no accounts and stores nothing, so closing the page clears the form. Save each invoice as a PDF before you leave.
Sources: GOV.UK, VAT invoices; IRS, Recordkeeping.