Many different electronic invoices are used by businesses and individuals at various stages during a transaction to facilitate it and ensure that the payment is smooth. Moreover, these electronic invoices are far superior to handwritten ones for several reasons. One is that electronic invoices are more secure and not prone to human errors. Moreover, Electronic invoicing is more convenient and reduces the workload on the workforce. During internal or external audits, electronic invoices can significantly help determine the cash flow compared to manual invoices. In this article, we will be talking about different types of electronic invoices and their uses. One of the best invoice builders we will recommend you use is Zenbill's Invoice Builder.
This is one of the most used types of invoices. It is straightforward and includes the company's name and logos, among other branding aspects. Moreover, there is some legal information present, including the invoice number. Apart from that, things are kept simple, and only the work done, and the price for it alongside it is mentioned. There are some banking details and contact details in case the client wants to call with a query.
Credit invoices are used by businesses that want to correct any errors in the original invoices. These invoices are used when the business bills more than the due amount due to several errors or reasons. The credit invoice has a negative value; hence they are due to pay that amount to the client they are dealing with. This invoicing is not that common and should be avoided by ensuring the numbers are right on the original invoice.
A debit invoice is used when there is an additional fee or charges that need to be added later for services provided after the original invoice was filed. This debit invoice is always a positive number since the client has to pay this price on top of the original invoice. Bill adjustments are pretty standard; hence, this type of invoice is common among small businesses.
Mixed invoices are somewhat rare when it comes to small-scale businesses since you are debiting and crediting the client simultaneously in these types of invoices. This is possible when you are drafting one invoice for multiple projects or services for the same client and have to make debit or credit changes in both the initial prices of the projects.
Commercial invoices are invoices generated by businesses on a larger scale and operate internationally since these invoices usually contain the amount of the goods transferred, which are primarily in bulk, including the shipping dates and estimated arrival timelines. Moreover, this type of invoice has more cargo information on it and is more detailed.
Timesheet invoices are used by solo practitioners, primarily those who bill their clients based on hours. This type of invoicing is straightforward. Some of the professionals who use this type of invoice include Psychologists who charge by the hour and lawyers. A timesheet invoice will contain an hourly rate, the number of hours the client is billed, and other essential information.
An interim invoicing system means that there will be a series of invoices during the project, most commonly during the completion of different phases. The client will be charged according to a successful milestone achieved. Interim invoicing can help manage a project and pay off your workforce if they work on contracts with you.