Everything to Know About the Purposes of Using Invoices for Your Small Business

There can be several purposes of using an invoice for your business. The primary purpose is to provide records of sale to both the clients and the business. If you are running a small business then invoice can be useful for accounting purposes. Namely, an invoice gives details about the payments decided between the client and you for your services. It serves as a proof in writing about the terms and conditions and makes the payment procedure easy for you.

To suffice it, invoice have multi purposes, it can be used as a sales agreement between the buyer and seller. It can be used as a guarantee to make the client pay for the acquired services on time. An invoice is a document that provides an outline about the details of the work, amount owed to the service provider, the payment terms and methods, the issue date and the due date also with the list of items or services given to the client. The invoice helps you get paid faster for your services.

If you are new to invoicing and to generate delivery notes for your small business then you have come to the right place.

Difference between an invoice and a delivery note

Remember that delivery notes are additional notes that are dispatched or handled with the invoices. Invoice shows that the products or services are provided to the client and then charged. Delivery note carries the same information about the products or services but with no mention of charges.

For example, if you have already created an invoice and a delivery note, but then you add a few more items to the delivery note. Will you have to generate a new invoice again?

The answer is yes, you will be creating a new invoice with all the latest enlisting of the items added.

We have discussed some basic purposes of an invoice such as it provides a record sale so you can get paid by the client. But this is not it, there are so many other purposes that might be latent for many to know.

An invoice can be used for the following purposes


As we know that invoice keeps a record sale and therefore, it can be used for bookkeeping purposes. Invoices can be kept as documents for accounting purposes, and as a financial history of your business. You can easily keep track of all the revenue adding to your business through the sales you make. You can also measure the profit your business makes with the help of invoices.

Tax records

The invoices that have been saved as documentation for several other purposes as mentioned above can also be used for tax purposes. The invoices can help you extract all the information about the sales and earnings you made to show it in your tax filings required each year. Small business owners must have daily records of their business transactions, including the invoices to show as a proof.

Legal Protection

One of the important purposes of using invoices especially for the small businesses is to protect them from false lawsuits, because invoices serve as a proof for the services you have rendered to the client with all the details about the payment terms and timeline to handover the work or the products to your client. If the invoices are signed then it becomes a legal document of your contract.

Support your customers

There are many ways in which you can answer your customer queries relating to invoicing. Whether you’ll go with phone, email, online chat or an automated chatbot, be sure to be ready to answer any questions relating to invoicing frequency, recurrent invoices, payments methods etc.

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