[lisa123]

hi all
just have a niggly question.
what happenswhen you start a contract mid month and invoice terms are 30 day (12 monthly payments of the same amount)
Do you do a rolling 30 days through the year, or say like me start date is 18th and invoice on 18th of each month?
It's for this new office cleaning i'm doing. Got the initial clean on saturday, then it's daily mon-fri.
What would you do?
Thanks

[*Chris Browne]

i do this 2 ways,
1. work out how many cleans you would have done if it was a full month, then work out the percentage of cleans you have done.
2. Just roll them on to there next months invoice(but tell them first)


hope this helps

chris

www.scsf.co.uk

[lisa123]

so i could invoice as day 1 being 1st feb, with payment due in 30 days. 
even though cleaning started on 18th feb?
I'm not sure they will go for that one.
unless i sayas its a part month, next month is 30 day and this month is 14 day?? I dont know

[CMS]

Always try and keep your invoices together, either at the end of the month or the beginning of the month. It's OK now but when you have loads of contracts you don't want to be invoicing them all on different days.

In your position, my first invoice would be for 18/30 of a month for the first month and then full months thereafter.

[lisa123]

let me get this straight, i'm having a confused day.
I'll invoice on day 1 which is the 18th, and they have to pay on the 30th day. (2nd march)
Then new invoice 1st march with paymnt due in 30 days??
Is this what you mean karl??
I am dozey today 

[CMS]

OK.....................this is what I do.

I invoice on the 1st of the month (in advance) and its due by the 7th of the following month. So, for February's cleaning I invoiced on 1st of February and it is due on 7th March.

It's not really in advance because by the time its due all cleaning will have been done for that period.

If there are any adjustments to make (additional cleans or missed cleans) you will have to adjust them the month after as the invoice has already gone out.

For February in your case I would invoice on 18th February for 18/30 of the monthly amount. That would be due by 7th March. I would invoice again on 1st March for a full month. That would be due by 7th April etc. etc.

[lisa123]

oh i see, sorry  :  i think the celebratory drinks are still in my system from last night 

thanks karl, ur a star

[*Chris Browne]

oh i see, sorry  :  i think the celebratory drinks are still in my system from last night 

thanks karl, ur a star

go and have a long lie down lisa(its the cleaning fliuds, thats what i always blame!)


chris

[lisa123]

thanks for your info before chris,
the 'cleaning fluids' definatly got to me 
i think i'll have an aftenoon snooze.......

[solar]

lisa

If you are invoicing monthly never invoice on the first of the month, unless vat return is due.

1.  Some companies have a policy of payment terms being 30 days from end of month, this means that if you invoice on the 1st of march, for instance, then the payment will only be due 30 days from the end of march, however should the company use these terms and you invoice on the 28th of February then the payment would be due 30 days from the end of February,


2. if your current 3 month vat return should run for arguments sake, from jan 1st to march 31st and you have invoices to send out at the end of march then depending on cash flow you can wait to send the march invoices out untill the first of april, hence the vat element of the work done in march would not fall due until the end of july, as your vat return from jan to march will not fall due till the end of april (no later),

3, the exception to the vat rule is when you ae using the cash accounting scheme, when vat will be due only on the invoices you have recieved payment on in the current vat period.

4,  if you are using a program such as sage, this has the facility to amend the date on an invoice so if you are sending out on the 1st of feb it can be amended to the 29th of jan or can be amended from the 28th of the month to the 1st of the next month this can only be done when first typing the invoice and not once you have posted it to your accounts ledger, this is good for customers that want your services but have to alter dates on invoices either back or forwards to coincide with their bugets and monthly dept spend

hope this helps

regards

Solar

[CMS]

Don't confuse the poor girl!

As much as your advice is well meant (and understandable by us Sage users), this is the first time Lisa has invoiced anything commercial. And she's not VAT registered.

Lets help her to walk before we show her how to run.

[solar]

sorwy ye loardship pointaken il twy an speeeeeeek pwain engwish necst tyme

 

[lisa123]

my eyes just glazed over with all that info   
Thanks for the info though,

I have decided that i will invoice for 1/3 of the month of feb, and additional cost for the one off clean. With the invoice issued on the first day, and to be paid by the 7th march, like you said Karl.
And then 11 equal monthly installments to make it the yearly total.

so £45 for the one off, then £65 (which is 1/3 of the monthly fee) £110 invoiced.
Then £206.80 per month for the next 11.
Total to be paid is £2340 plus the one off £45.

Does this sound about right? (I know i'm a few pennies under for those who want to checkit)
I hope they agree to paying like this.

xxx
 

[HQCS (John Kastrian)]

I would invoice last day of month (Feb) for all work done in February,and then last day of month afterwards.
This allows you to easily adjust payments if you carry out additional work in any month.
Most companies use bacs system for payment and many have 2 bacs runs per month,mid and end,so if you invoice end of the month you should normally get paid within 2 weeks,or 30 days at the latest,it is standard business practice to pay within 30 days,and some will make you wait the full 30 days.
One of our contracts like to be billed for amount of visits per month,this varies as there are varying number of days per month,but we both know exactly where we are.ie 20 visits,22 visits etc,plus any additional services.
Hope you haven't underestimated,or it must be a very small office.
Regards,
John

[CMS]

Keep it simple Lisa..................

[lisa123]

its too late to go back now..........
I have specified on the letter that what i wrote up there is what is to be paid.
Just got to get them to sign the contract, and we need to collect keys later today, and its done.
Thanks for all your assistance.

xx