How To File Invoices: Why It’s Important and Key Steps

Michael explaining how to file your receipts

Why is it important to file invoices?

Many businesses, from one-person independent contractor businesses to large corporations, depend on invoices in some way. Businesses can send and receive invoices, send and only receive invoices, or only send invoices. Most businesses want to carefully store invoices for future reference because they contain important information. There are frequently tax laws pertaining to this, which can differ by business type and industry. Therefore, having a well-organized system for filing invoices is very beneficial.

How to file invoices

The procedures for filing invoices, whether they are invoices you have sent to clients or invoices you have received from vendors, are as follows:

1. Make sure all data is correct and updated

You should probably verify that all the information on an invoice is accurate and current before filing it. This entails checking that all contact information, dollar amounts, and invoice status information are accurate. The status is whether it is paid or unpaid. Before filing a version of the invoice, you should double-check this information to avoid confusion later when you forget the invoice’s specifics or if another party needs to refer to it.

Additionally, before submitting an invoice digitally, make sure the file is named clearly. If you want to organize this, you might use an invoice number and date or you might use the vendor or client name and a date. It’s best to use the same approach for all of your invoices, regardless of the approach you choose.

2. Create folders by month and year

You can choose to store invoices in physical folders or digital folders if you’d rather. Although many businesses have shifted to a wholly digital approach, each has advantages. However, you might discover that organizing them by month and year is the simplest option. You might, for instance, have 12 folders for 2021, including March, April, and May.

You should be able to file all invoices collectively whether they are paid or unpaid if you track your invoices digitally using a spreadsheet or accounting software. Digitally filed invoices are frequently simpler to search through, and there are additional ways to determine whether they have already been paid. However, categorizing invoices as paid or unpaid can be useful if you want more accuracy or are using a physical filing system.

3. Use software for tracking

Software for tracking your invoices can be very helpful in a variety of ways. These techniques range from a straightforward spreadsheet that provides basic information about each invoice, such as whether it has been paid or not, to a thorough accounting software. If you use accounting software, copies of your invoices may already be stored there, but it can be useful to save and archive a copy physically or digitally in case your software should malfunction.

Keep a spreadsheet with your invoice information, including the vendor or client it relates to, the invoice number, the amount, whether it has been paid or not, and where it is filed, even if you don’t use accounting software. By doing so, you can quickly access that data without having to search through your files.

4. Scan paper invoices

It may be beneficial for you to scan any paper invoices you receive if you prefer a digital filing system. Instead of having some invoices digitally and some physically, you can group all of your invoices together in your digital files. Developing the habit of scanning each invoice as it is received can be beneficial because you won’t have a large number of invoices to scan at once.

You may want to keep in mind to track those invoices in your software as well if you are scanning paper invoices and using it to track your invoices, provided that they haven’t already been accounted for. By doing this, you can avoid any potential problems that could arise from receiving a paper invoice and either forgetting about it or not knowing its status.

5. File frequently

When you receive invoices frequently, it’s crucial to file them right away so that you can stay organized and informed about the status of your invoices. It’s simple to fall behind on filing or to allow the invoices to become disorganized and difficult to sort through if you do. If you have the time, you could file every invoice as it arrives, every day, or every week. Maintaining a schedule that works for you is crucial to keeping your invoices organized.

6. Back up your files

Whatever method you choose to use to organize your invoices, you probably want a backup strategy as well. For instance, if you physically file your invoices, you might also want to keep digital copies. You might want to keep copies on a cloud server if you keep digital copies on local hard drives in your office. You want to make sure you can access these invoices in the future because you might need them for tax purposes years from now. If you prefer, you may even be able to purchase software that automatically uploads your digital files to the cloud.


How do I file an invoice?

How to file invoices
  1. Make sure all data is correct and updated. You should probably verify that all the information on an invoice is accurate and current before filing it.
  2. Create folders by month and year. …
  3. Use software for tracking. …
  4. Scan paper invoices. …
  5. File frequently. …
  6. Back up your files.

How do I file accounts payable invoice?

File accounts payable documents by payment date. Check the due date and set a payment date for the invoice once invoices and supporting documents have been matched. The invoices should be arranged in folders for each day of the month. If you know when the invoice will be paid, file it under that date.

What are the 5 basic filing systems?

There are 5 methods of filing:
  • Filing by Subject/Category.
  • Filing in Alphabetical order.
  • Filing by Numbers/Numerical order.
  • Filing by Places/Geographical order.
  • Filing by Dates/Chronological order.

How do you file a receipt and invoice?

Include as many specifics as you can on your invoices and receipts. Date, time, customer identification, product or service name, transaction amount, tax and discount information, invoice or receipt reference number, etc. Your accountants will appreciate it. Match your invoices and receipts in chronological order.

Related Posts

Leave a Reply

Your email address will not be published. Required fields are marked *