A due date on an invoice is not inherently legally binding on its own, as an invoice is a record of a transaction rather than a contract. However, it becomes legally binding and enforceable when it aligns with a pre-existing agreement, contract, or purchase order accepted by both parties.
What Makes Invoices Legal? An invoice issued only becomes legal once both parties agree to it. It then becomes a legal debt and the customer is required to pay it. It's important to pay careful attention to all charges and wording on an invoice before agreeing to it.
In any case, omitting the due date from an invoice is a mistake. As an official document, there's a set series of information that's required on an invoice. Although a due date is not a mandatory invoice field, it's highly recommended for several reasons which we'll outline below.
Invoices have no proof that both parties have agreed to the terms stipulated in the invoice and therefore this is one of its largest limitations.
Therefore an invoice would be invalid if it did not include such details as: the name and address of the person (customer) to whom the goods or services have been supplied.
Maybe you've just discovered an old invoice that slipped through the cracks, or maybe you've been chasing down a customer who seems to have completely disappeared. Either way, you're probably wondering, how long can I keep chasing after this money? The short answer is for most debts, that limit is 6 years.
False invoicing may also be considered invoice fraud. This occurs when a business sends an invoice to a customer to pay for goods or services that the business is aware that the customer did not purchase.
Always clearly state the due date
The general rule is 30 days from the invoice date. However, you can discuss this with your customer and either make it shorter or longer than 30 days. Regardless of what you agree upon, the payment terms and the due date should be clearly stated on the invoice.
The due date is the latest date for when you must pay your invoice. The invoice date is the date when the invoice was issued.
In the US, strict accounting standards like ASC 606 and IRS rules require invoice dates to accurately reflect when goods or services were delivered—not when paperwork is processed.
Manner of Issuing Invoice
The invoice shall be prepared in triplicate, in case of supply of goods, in the following manner: (a) The original copy being marked as ORIGINAL FOR RECIPIENT; (b) The duplicate copy being marked as DUPLICATE FOR TRANSPORTER; and (c) The triplicate copy being marked as TRIPLICATE FOR SUPPLIER.
Customers should ideally raise their dispute as soon as possible. It's common practice for this to happen within 30 days of receipt, although there's no legally defined time limit. This should be done in writing by a formal letter of dispute, although it's also common for this to be sent as an email.
Contracts become null and void if one party is coerced into signing through threats or manipulation. Duress involves physical or mental threats, while undue influence occurs when someone manipulates or pressures another party into an agreement against their will.
30+ days late
If your client hasn't made payment (or meaningful contact) within 30 days of the invoice becoming due, it may be time to issue a letter before action (LBA), or to pass over the matter to a debt collection agency. An LBA gives your client formal notice that legal action is imminent.
Remember: an invoice requiring immediate payment should not come as a surprise. Clients should understand that payment is due upon receipt when your contract is completed.
Common invoice timeframes for payment include 14 days, 30 days, 60 days and 90 days. Typically, the standard term of payment is 30 days or less, but you can choose any amount of time for your term. Online invoicing makes paying faster and easier for customers to pay quicker.
A fake invoice, ghost note or ghost invoice is an invoice for goods or services that have never been delivered, sent by scammers. These scammers often send them with thousands at the same time, which they hope companies will not check and pay for.
Missing or Incorrect Information: No unique invoice number. No issue date or incorrect date. Missing or incorrect company name or address.