Invoice Terms and Conditions UK: What to Include and Why
When you send an invoice, your terms and conditions aren't just legal boilerplate — they protect your cash flow and set clear expectations with clients. This guide covers exactly what to include in your invoice T&Cs as a UK freelancer or small business.
Why Invoice Terms and Conditions Matter
Many UK freelancers send invoices with nothing more than a payment due date. That's a mistake. Without clear terms:
- Clients may dispute how long they have to pay
- You have no legal basis to charge late fees
- Disputes over work scope are harder to resolve
- You can't enforce anything in court without documented agreement
A few lines of clear terms can save you months of chasing payments.
What to Include in UK Invoice Terms and Conditions
1. Payment Due Date
State when payment is due. Common options:
- Net 7 — payment within 7 days of invoice date
- Net 14 — 14 days (common for smaller freelance work)
- Net 30 — 30 days (standard for larger businesses)
- Due on receipt — immediate payment expected
UK law under the Late Payment of Commercial Debts Act 1998 sets a default of 30 days for business-to-business transactions if no payment date is agreed.
Tip: Shorter terms = faster payment. Net 14 is reasonable for most freelance work.
2. Accepted Payment Methods
Be explicit:
- Bank transfer (BACS/CHAPS) — include sort code and account number on the invoice itself
- PayPal, Stripe, or payment link
- Cheque (uncommon, but some clients still use them)
3. Late Payment Fees
Under the Late Payment of Commercial Debts Act 1998, you are legally entitled to charge:
- Statutory interest at 8% above the Bank of England base rate
- A fixed debt recovery cost of £40–£100 depending on the debt amount
To enforce this, your terms must state you will charge late fees. Example wording:
"Invoices not paid within the agreed payment terms will incur statutory interest at 8% above the Bank of England base rate, in accordance with the Late Payment of Commercial Debts Act 1998."
4. Ownership and Rights
If you're a designer, developer, copywriter, or creative:
- State that copyright remains with you until payment is received in full
- This is a powerful lever — clients can't legally use your work until they pay
Example:
"All intellectual property and copyright in deliverables remains with [Your Name/Business] until full payment is received."
5. Revision and Scope Limits
If the invoice is for a project:
- State what's included
- Note that additional work will be quoted separately
This prevents scope creep being used as a reason to withhold payment.
6. Dispute Resolution
Include a clause on how disputes will be handled. For most UK freelancers, this is:
"Any disputes should be raised in writing within 7 days of invoice date. Undisputed portions of an invoice remain payable on the agreed due date."
7. Governing Law
If you work with international clients, state:
"This invoice is governed by the laws of England and Wales."
Example Invoice Terms and Conditions (Short Version)
Payment is due within 14 days of the invoice date. Accepted payment methods: bank transfer. Late payments will incur statutory interest at 8% above the Bank of England base rate per annum, in accordance with the Late Payment of Commercial Debts Act 1998. All intellectual property remains with [Your Name] until payment is received in full. Disputes must be raised in writing within 7 days of invoice date.
Where to Put Your Terms
On a paper or PDF invoice, terms typically go:
- Below the totals — a brief version (1–3 lines)
- On the reverse — full terms for longer documents
- As an attachment — a separate T&C document for larger contracts
For freelancers using Billdrop, you can add your terms as notes on the invoice, which appear in the PDF.
Do You Need a Separate Contract?
Invoice terms aren't a substitute for a proper contract — especially for larger projects. If you're billing more than a few hundred pounds, have a signed agreement in place before you start work.
For day-to-day invoicing, clear terms on every invoice are usually sufficient for smaller, ongoing client relationships.
Summary
| Term | Recommended | |------|-------------| | Payment period | Net 14 (or Net 30 for corporate clients) | | Late fee | 8% above BoE base rate | | Rights | Retained until paid | | Disputes | Must be raised within 7 days | | Governing law | England and Wales |
Billdrop is a free invoice generator for UK freelancers and small businesses. Create professional invoices in seconds — no account needed.