Invoicing is more than just the thing you send to request payment. Every invoice sent has important details that make it an invaluable document to be kept in your records and referred back to.
But if your invoices lack detail, especially in a small business context, you might find the information you need is missing. Sending an invoice with only a total billed amount isn’t sufficient.
This is where an itemized invoice comes in. By providing more context and an itemized list of what was purchased, both you and your customers get the full picture, which future you will be thanking you for.
Here are reasons why you may benefit from using an invoice template:
If you want to edit an itemized invoice template in Word or Excel, you simply need to download and open the file. From here, you can customize it by altering the font and text, adding new line items, or adding brand logos. Once you complete these edits, all that’s left for you to do is save your edited version.
However, editing a PDF itemized invoice template can be more difficult as PDF files aren’t easy to edit. In this case, the best course of action is to make the changes in Word or Excel and then convert them to PDF. Selecting “Save As” should present an option to save the file as a PDF, which you can use as an itemized invoice template.
To help save time, download our itemized invoice template and edit it with your personal specifications and branding. Save that document without any billing information and use it as your personal itemized invoice template.
To make an itemized invoice, you need to create the fields to accommodate the information that goes in an itemized invoice. First, the name of the seller, as well as their contact information, must be available. Then, you have to include line items that pertain to each cost that contributes to the total cost. Typically, this means;
Finally, it’s necessary to include a field for the date of purchase and ship date, payment due date, and the shipping address if applicable. While law and regulation dictate that an itemized invoice must contain this information, the design specifics and format are at the discretion of the business.
The easiest way to create an itemized invoice is to start with an invoice template.
An itemized invoice is a type of bill you send a person before they pay, which doesn’t stop at presenting the total cost. Instead, it goes into depth on the costs that add up to the final cost. This includes each good within the bill and services, such as the value of labor hours, culminating in the final total. Itemized invoices allow greater transparency and create a thorough paper trail for both parties to fall back upon.
It is often asked what the difference is between an itemized invoice and an itemized receipt. The difference is an invoice is given prior to payment and an itemized receipt is provided after payment is received.
Start by opening a blank Excel sheet and adding fields designating your name, the client’s name, services rendered, total cost, and the payment date. Excel is particularly well suited to designing an itemized invoice, but it can be challenging to make one that looks clean and organized. As such, it’s often better to use an Excel itemized invoice template and fill in the data as necessary.
An alternative way to make an itemized invoice in Excel is to use invoicing software like BILL Accounts Receivable to get paid faster. BILL enables you to create invoices easily, accept payments online, send payment reminders, and track invoice statuses.
Itemized bills have various sorts of information at the margins, such as the branding of the issuing company and the name of the client. The main body will be a list of individual items, each contributing to the total cost. Typically, itemized bills display this list in a descending fashion, with each charge stacked one below the next. Finally, the bottom will show the total cost and date of payment. Other information may be available somewhere on the bill if relevant, such as shipping address and shipping costs.
To illustrate the in’s and out’s of an itemized invoice, let’s look at an example of an itemized invoice as sent by a fictional consulting company.
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Above is the itemized invoice, but let’s dig deeper into each individual section, starting with the invoice details.
The invoice details covers when the invoice was created, when payment is due, and the invoice number, which can be used in recordkeeping and tracking payments.
The bill from/to section has the business and contact information for the buyer and the company details for the seller. If there’s any need to follow up on the invoice, the information is readily accessible in the document itself. You may want to add additional details like a phone number or P.O. box.
The itemized breakdown includes all services provided, the quantity of the service, and the rate for the service. In this example, the description is used to show the quantity: hours or a per vertical service. This way it’s not ambiguous what the quantity is, which would potentially lead to disputes.
In the footer, there’s a final tally of the subtotal, tax rate, and total, as well as a section for notes. The notes section can be used for a personal touch or additional details on payment terms (including any potential late fees), projects worked, period of time the goods or services were rendered over.
An itemized invoice should be used if an order has multiple products or services that are being billed. The itemized breakdown provides complete transparency on how much each item or service costs, and how it makes up the total billed amount.
Some industries that most commonly use itemized invoices include:
These are just a few examples of industries that use itemized invoices. Generally speaking, it’s better to send an itemized breakdown for complete transparency regardless of what industry a business is in.
Yes, an itemized invoice can be used for hourly labor or billable hours. However, we also offer an hourly invoice template that’s specialized for that use case.
When using our itemized invoice template, make sure to avoid these common mistakes: