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Each week we shall reproduce excerts from the Guide for Business published by leading commercial law firm Commins Hendriks.

The  84 page Guide for Business is available from all Commins Hendriks offices, the office of the Wagga Wagga Business Chamber and Hunters newsagent where it can be purchased for $35.   For more information

Important Tips for your Tax Invoices

To optimise a businesses position in an action for recovery of debt it is important for a business to ensure that invoices or accounts issued include the following in addition to the normal requirements:

§  It is specified the date the invoice falls due. This can specify a specific date or can simply say the number of days after issuing the invoice payment is due.

§  If the business intends to charge interest on overdue accounts or invoices this should be specified on the invoice together with the rate of interest to be charged. This rate of interest should be reasonable. When commencing claims in the Courts interest is claimable at the Court interest rate which is currently 10%pa (as at July 2010) if not specified on the initial invoice. If a higher rate is specified on the invoice this rate can be charged as the debtor has been given notice. Businesses should also be wary that any interest rate they specify is not too high as it could be construed by the Courts to constitute a penalty and will then be invalid.

§  A clear description of what the invoice is for is also necessary. It will therefore be apparent from the outset what the debtor is being billed for and what it is ultimately claiming payment for.

§  Businesses should also ensure invoices are issued shortly after work is completed. The time frame between work being done and invoicing tends to correlate with the time taken to receive payment.

§  Be sure to include any other details required by your industry regulator or the ATO.

§  Be sure to indicate any statements required by particular legislation such as Building & Construction Industry Security of Payment Act.