Accounting & Finance Productivity Trades & Services

Tradie Tip – Is there an expiry date on an invoice?

Written by Jon Dale

I saw a Facebook post the other day in the Builders Talk Group from a guy who found himself in an awkward situation. I won’t name him (and show him) because I’m going to be critical.

He’d done work for some real estate agents – property managers managing rental properties, over a year and a half ago. He had only just sent them the invoices for the work recently – a whole 18 months later.

Not surprisingly, they didn’t want to pay. He was asking the group for advice on where he stood legally – how he could get paid for the work he’d done.

It’s not my area but I think the advice other people gave him was that there is no expiry date on an invoice and they still have to pay.

Is it okay to raise an invoice late?

But here’s the thing… the damage is done!

If you do this, you’ve caused significant problems for your customer, haven’t you?

They’ve got to go back to the landlord (in this case at least) and try to recover the money for work in the distant past. That landlord might not be their client anymore – the world changes in 18 months.

So you’re damaging your relationship with your customer by doing this, aren’t you?

You’re causing them problems because you were too disorganised to do your job properly. Or your business is too disorganised to do the job properly.

So, once in this position and wanting payment for the work you did damage relationship that could bring repeat work long into the future, whether you’re morally right or wrong, there’s a cost to pursuing it and as a business coach, my job is to look at the bigger picture.

You messed up, not them. You’ll damage your business while pursuing this.

Which is worth more? The forgotten invoices or the future business you jeopardise?

Raising an invoice is your business’ responsibility

But this isn’t the real lesson is it?

What on earth are you doing not sending invoices until 18 months after you’ve completed the job?

Remember, you and your business or your staff do work for money. Raising the invoices and getting paid is a very important part of that.

You need to set up systems so this stuff doesn’t happen. Going through your diary on Sunday does not cut it.

If you’re too disorganised to do this stuff yourself, hire someone to do it for you. There are people will do this better than you and find it easy and enjoyable. They’ll set up the systems and manage them, freeing you up to do the work you’re good at as well as the marketing, sales and the leading of your team.

That’s part of my job – helping you build your business. So you build a functioning business where the people you hire do jobs they’re good at – not where you try to do everything yourself and mess things up in an expensive fashion.

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About the author

Jon Dale

Jon Dale, of Small Fish Business Coaching is a business coach for tradies - trades business owners wanting to grow their businesses. His articles will help you understand how to manage your marketing, sales, operational systems and the people of your business. His program is called the Tradies Toolbox because he hopes you can use it, like a tool, to make more money and build a business you're proud of.

There are a few ways you can explore whether working with Jon is right for you, right now:
1. You can watch these videos - subscribe here to get them emailed every week.
2. You can join the Tradies Business Toolshed Facebook Group and participate.
3. You can attend the next Tools Down Workshop - 2 days of Jon explaining the framework.
4. Or you can book a 10-minute filter call where you and Jon will both look at whether he can help.

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