Debitoor Dictionary

Accounting terms explained in a simple way

Over 150 Articles for Founders and Entrepreneurs

  1. Electronic invoicing
  2. Open items creditor
  3. Open items debtor
  4. Proforma invoice
  5. Invoice number

Invoice - What is an invoice?

An invoice is a document sent to a buyer that specifies the amount and cost of products or services that have been provided by a seller

Invoicing your customers has never been easier. Debitoor invoicing software makes it simple to create and send invoices in less than a minute. Try it free for 7 days.

An invoice indicates what must be paid by the buyer according to the payment terms of the seller. Payment terms usually specify the period of time that a buyer has to send payment to the seller for the goods and/or services that they have purchased.

An invoice provides a detailed account of the products or service and a set of other information that can vary a bit depending on the requirements in the country the invoice is issued and the type of product or service being sold.

What an invoice should include

Usually, an invoice will include an the following points of information in order to be considered legal invoices:

  • The word ‘Invoice’
  • A unique reference number: the invoice number
  • The date the product was sent or delivered (or the date the service was rendered)
  • The date the invoice was sent
  • The contact information and name of the seller
  • The name and contact details of the buyer

  • The terms of payment (that explain the means of payment, when the sum should be received, any cash discount details for early payment, late payment fees, etc.)

  • An account detailing the product/service
  • The cost per unit of the product (if this applies)
  • The total amount that is owed

Sales v. purchase invoice

An invoice shows the payment that a buyer owes to a seller. From a seller’s point of view, an invoice for the sale of goods and/or services is referred to as a sales invoice.

From a buyer’s point of view, an invoice for the cost of goods and/or services rendered is referred to as a purchase invoice.

Invoicing online

Today, online invoice software makes it easy to create and send an invoice. Cloud-based online software is available at any time, anywhere you have an internet connection and smartphone, tablet, or computer.

Good invoice software provides invoice templates that adhere to the legal requirements as well as VAT for an invoice in the country in which your business is based, meaning that there are no concerns about whether you've included all the details your invoice needs.

Invoices in Debitoor

In Debitoor you can design, create, send and enter payment on your own invoices from your computer, smartphone, or tablet.

Our easy-to-use invoice templates make it simple to create professional-looking invoices in just a few clicks. Add your company logo and your own photos to customise your invoice and promote your unique brand.

Read more about how to create your first invoice in Debitoor as well as how to design and send invoices.