Reply to: Two Clients - one on self-billing invoices and the other on normal invoices

[ladymuck]

Nah, you're alright. I'm happy with Crunch and their online portal. Does everything I need and for a very good price. (*cough* except support multiple invoice numbering sequences).

By the way, I've spoken to one of their accountants, and they've confirmed that I can just raise 'dummy' invoices for the self-billing ones, and leave it at that with raising other invoices as normal.

Glad to see you did due diligence on the free advice by getting some from the company you pay to advise you

[zonkkk]

You are using rubbish software, time you migrated to FreeAgent anyway.

Nah, you're alright. I'm happy with Crunch and their online portal. Does everything I need and for a very good price. (*cough* except support multiple invoice numbering sequences).

By the way, I've spoken to one of their accountants, and they've confirmed that I can just raise 'dummy' invoices for the self-billing ones, and leave it at that with raising other invoices as normal.

[Fred Bloggs]

The difficulty is that the Crunch online system won't allow me to modify the invoice number in any way. If they did, indeed it would be simple. I have raised it with them as well to see what their VAT accountants suggest.

You are using rubbish software, time you migrated to FreeAgent anyway.

[zonkkk]

Possibly. Just want to make sure everything's in order. Thanks for all your replies.

[ladymuck]

That's not 'just' paperwork, it's an invoice they have raised for me, based on which they have paid me. These are official documents, you can't just throw it away and create another one.

You really are over egging this by a huge amount.

[zonkkk]

Indeed. I get surprised why folks can't work it out for themselves, it's so simple and so obvious. Yet there's always someone asking. Just file away the agency or client self invoices. Raise your own for each agency/client with a prefix identifier unique to each agency/client. What's difficult there?

The difficulty is that the Crunch online system won't allow me to modify the invoice number in any way. If they did, indeed it would be simple. I have raised it with them as well to see what their VAT accountants suggest.

[zonkkk]

It's not really. You just throw away the agency issued paperwork and raise your own but don't send it to the agency.

That's not 'just' paperwork, it's an invoice they have raised for me, based on which they have paid me. These are official documents, you can't just throw it away and create another one.

[Fred Bloggs]

It's not really. You just throw away the agency issued paperwork and raise your own but don't send it to the agency.

Indeed. I get surprised why folks can't work it out for themselves, it's so simple and so obvious. Yet there's always someone asking. Just file away the agency or client self invoices. Raise your own for each agency/client with a prefix identifier unique to each agency/client. What's difficult there?

[ladymuck]

Which is why I give every client a prefix and then use sequential numbers from there. Self billing is otherwise a world of pain for accountancy purposes.

It's not really. You just throw away the agency issued paperwork and raise your own but don't send it to the agency.

[Lance]

I am using the Crunch online system.

I am calling a non-invoice the invoice raised to account for the self-billing invoice. That is not a real invoice - the self-billing invoice is. This is still given a number as if it was a real invoice.

The VAT figures that are being reported to HMRC are correct. But the 'real' invoice numbers the ones sent to the clients will not be sequential which goes against the HMRC rules for VAT invoices.

Again, not an issue of you only have one client. But if you have multiple clients one of which is using self-billing your numbering sequence will be messed up and this might be a problem in case of an investigation, as far as I understand.

as LM says, you are over-thinking it.
Your invoices aren't non-invoices. You are just not sending them to the agency as it confuses them. They correlate with the self-billing invoices, but the fact of self-billing does not make your invoices null.
If the agency refused to pay you, your invoices would be sent to them and be a matter of evidence as they are legal documents.

But using a different numbering sequence also works (AAA123456 for client A and BBB123456 for client B).

[eek]

I am using the Crunch online system.

I am calling a non-invoice the invoice raised to account for the self-billing invoice. That is not a real invoice - the self-billing invoice is. This is still given a number as if it was a real invoice.

The VAT figures that are being reported to HMRC are correct. But the 'real' invoice numbers the ones sent to the clients will not be sequential which goes against the HMRC rules for VAT invoices.

Again, not an issue of you only have one client. But if you have multiple clients one of which is using self-billing your numbering sequence will be messed up and this might be a problem in case of an investigation, as far as I understand.

Which is why I give every client a prefix and then use sequential numbers from there. Self billing is otherwise a world of pain for accountancy purposes.

[zonkkk]

I am using the Crunch online system.

I am calling a non-invoice the invoice raised to account for the self-billing invoice. That is not a real invoice - the self-billing invoice is. This is still given a number as if it was a real invoice.

The VAT figures that are being reported to HMRC are correct. But the 'real' invoice numbers the ones sent to the clients will not be sequential which goes against the HMRC rules for VAT invoices.

Again, not an issue of you only have one client. But if you have multiple clients one of which is using self-billing your numbering sequence will be messed up and this might be a problem in case of an investigation, as far as I understand.

[ladymuck]

You're definitely overthinking it.

As mentioned above, lots of us raise internal invoices to cover self-billing work. I'm not aware of the concept of a non-invoice. What accounting software are you using that allows you to create an invoice for a sale but excludes it from VAT returns, as you're saying it's not being reported to HMRC?

[zonkkk]

So does the agency that issue the self-billing invoices use your invoice numbers and that's why there's a numbering issue?

The issue arises, when I raise the 'non-invoice' in my system to balance out the books. That will be given a number (automatically).

No 1234 - Proper Invoice (sent to client)
No 1235 - non-invoice (raised for a self-billing invoice)
No 1236 - Proper Invoice (sent to client)

The sequential numbers sequence for real invoices is broken: 1234 followed by 1236 (because 1235 doesn't exist in the eyes of HMRC).

[Fred Bloggs]

So does the agency that issue the self-billing invoices use your invoice numbers and that's why there's a numbering issue?

I'm not getting how you raising your own internal invoice and then matching it to the agency issued invoice will mess any numbering up.

I always ignored agency self-billing invoices and just created my own in my accounts system to register the payments against but never sent to the agency. I kept the self-billing paperwork and just used it like a remittance advice.

No need to have overcomplicated things at all.

Indeed. I have always just filed away agent or client self invoices. Like you, keeping everything in my own system without my invoices ever being sent out. Keeps everything neat and tidy.