Invoicing clients is the fifth installment to my Freelance Writing Guide For New Freelancers. While we work with clients as writers, we also have to find convenient ways to invoice them for our services.
Luckily for most, PayPal is a widely used by online businesses for service transactions, whether you buy products or get paid for services you provide.
While most people know PayPal as a merchant solution, many don’t know that you can also send invoices with PayPal or even setup recurring payment requests for repeat services. Doing this provides your clients with a fuss free way of receiving tax invoices, while you can keep track yourself.
As with running any business, it is essential for freelance writers to keep book on income and expenses for the tax man. Starting off the right way will save you many headaches later down the track.
The recurring payment feature in PayPal is great for regular clients who buy the same service from you every week or month. It will remind them to pay you via a friendly email and help both the client and freelancer to stay organized.
To send an invoice to a client simply navigate to the Request Money tab within your PayPal admin. Then click on Create an Invoice.
If you have previously saved invoices, you can choose them via the pull down menu in select template. I normally name them by the clients name which makes it easy to find what I’m looking for in the future. Naturally this feature only works if the invoice is recurring (e.g. stays the same for both your service and pay). Otherwise just choose new invoice and click continue.
In the new window that appears you can create your invoice in easy steps, using your address, phone number, the details of the invoice, currency you want to be paid with and so on. PayPal also provides a nice and neat looking table in which you can insert your service modules.
Once you click on continue you will be able to check your data once more before you send it off to your client. This is so easy and fast, that creating invoices with PayPal is the best thing I have come across.
Previously I used FreshBooks who also provide a good service, both free and paid, but lately I have reverted to using mainly PayPal since it is so easy and fast to use.
In the end, it doesn’t matter which service you use to send client invoices as a freelance writer, as long as you have a system that works for both you and your clients.
Monika
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Just a note on this one.
PayPal is very unfriendly to providers who have more than one sales tax involved, such as the Canadian taxes that include a federal and provincial tax.
These taxes, by law, must be clearly indicated SEPARATELY and PayPal does not support that option.
Also, indicating your government-issued tax numbers (another by-law must for Canadians) means you need to type it in the notes manually, by hand, each and every time.
An alternative is to create an Excel or Word template for your invoices. Fill it in, assign write protection and lockdown, and send it off.
Or, be a true business person and get some accounting software that generates invoices for you and also tracks your income and expenses.
Why’d you change from Freshbooks, by the way, besides ease? Easier is not always the best choice in business.
@ James: Good to know this for you Canadians. It looks like life is a little harder for you guys when it comes to tax related stuff.
I never bothered with account keeping software because i truly hate income tax preparation and book keeping. I rather pay an accountant for doing all the dry work and use the free time to build niches or write.
So much more fun.
As for dropping Freshbooks, no particular reason other than liking PayPal better. That of course is my own personal choice.
Great advice for any freelancing professional.
Switching to Paypal as my primary invoicing tool has saved me time and made preparing my taxes easier to boot!
My CPA grumbled about the fees… but the time it saved me was WELL worth it. That included the time I used to spend creating the invoices, then going to the PO Box to mail invoices and pick up paid invoices, taking the checks to the bank, etc.
When you’re freelancing, time is money. The small service fee I pay to use Paypal is tiny compared to what I can earn with the time it’s saved me!
@ Virtual Impax: Thanks Kathy, I agree with you on everything you said. I really really really hate book keeping. Did I mention how much I hate bookkeeping?
Monika,
I’m getting the feeling you may actually hate book keeping more than I do… which is saying something!
@ Virtual Impax: LOL, I reckon you might be right there. The funny thing is that I’m really good with numbers, it’s just the dry stuff of the whole scenario that gets me to sleep before I have even started.
I like paypal. Nice and easy. If I can have easy, I can do more things. I take all my earnings to the accountant because I have enough to deal with.
@ Ellen: seems we are on the same page here as well, just like Kathy said. Keeping an accountant frees up time for more interesting things.
When I was in MLM I tried really hard to do it all myself but it just wouldn’t work out. I came to find that accountancy and me were not an ideal couple at all. These days I leave this to the professional instead and sleep better at night for it.
I didn’t know you could create invoices in Paypal. I’m used to creating my own invoices in Word, but thanks for the info, hun, ‘cos I really didn’t know about the Paypal invoice thingymejig
.
Talking about taxes, I am SO behind, I’m in front
.
@ Ebele: I’m glad to have shown you something new. You know, I never knew this until a few months ago myself. Before that I stuffed around with countless applications until I found Freshbooks.
Then PayPal’s invoicing was discovered and the rest was history.
[...] before. It looks much more professional than a regular money request. Freelancers should check out Invoicing Clients - Freelance Writing Guide for more [...]
Thanks for the piece on PayPal, Monika - I will need to be doing this soon and this will help.
(Thanks also to James for pointing out some very Canadian nuances.)
I’m sure that I will figure out some combination of the two (PayPal and physical invoicing).
-Brett
Hello Monika,
I tried to contact you regarding your writing some articles for me but it would never let me choose a reason as to why I was contacting you. Went ahead anyway and wrote you but when I hit the send button it said there was missing information and deleted by message to you. Anyway contact me if you are interested. Thanks
Thanks for running through these basics Monica.
The question of how to invoice and the best way to be paid (PayPal, direct transfer, cheque) must be common knowledge amongst those who have been freelancing for a while, but I have found very little online in the way of guidance for new freelancers.
Looking forward to the next in the series.
[...] Invoicing clients [...]
There is another possible solution for freelancers who aren’t good at record keeping and developing an organized invoicing system. That was one of my least favorite things to do when starting out, so I started working with an employer of record organization called MBO Partners that handles all of my invoicing for me, and when necessary, collections. I keep track of my time using their simple web-based system, and can input notes for my clients about what work I completed. I can submit my business expenses with an expense report and take advantage of my deductions right away, and at the end of the year I get a W-2. It’s so easy, I can’t imagine my freelance lifestyle without it.
@ Angela: Thanks for telling us about MBO Partners. Unfortunately this won’t be any good for me since I pay taxes in Australia. I doubt they do foreign tax book keeping.
@Monika - I believe they will work with anyone who gets paid in U.S. Dollars, so it might apply to some who are overseas, but not all.