A photographer won’t get paid unless they send an invoice to the customer. For some silly reason, most businesses refuse to send out cheques just for the fun of it. After a photo assignment is completed, send an invoice. There’s no grace period required. It’s not necessary to wait a few days, or weeks, to avoid looking greedy.
Your invoice must contain your legal business name, contact information, invoice date, invoice number, and your tax number(s). It also must also have the customer’s name and contact information.
The invoice should spell out what the photo assignment was. Don’t expect the photo editor to remember every assignment. Also, the customer’s accounting department won’t know what your invoice is for.
Sometimes the person who hires you is not the person who will receive the invoice. So make sure you know to whom the invoice is sent. Always ask the customer if they require a Purchase Order number or any other reference number included on the invoice.
Invoice Details
It’s never a good idea to use the phrase “Sold to” on an invoice.
Professional photographers don’t sell pictures but rather they license their work. If your invoice says “Sold to”, a customer could argue that it means they bought and own the photos. You can use “Bill To”, “Customer”, or “Invoice To.”
Instead of using the word “expenses” on your invoice (and estimate), use “costs”, “charges” or “production charges.” Expenses are what a company reimburses to its employees. The photographer is not an employee, but an independent business.
Photographers should mark up some/most/all of their expenses. This is a common business practice and is another small step toward making a profit.
There’s no reason to give expense receipts to a customer because you’re not an employee. You are required to retain such receipts for your tax records. Some ad agencies may demand receipts and will refuse to pay markups even though they will turn around and mark up its expenses to its clients.
You should indicate your preferred method(s) of payment. Don’t forget to state when you expect to be paid, otherwise a customer can rightfully take forever to pay. You might use the always popular, “Balance due upon receipt” or you might be more poetic:
Money is needed,
And time is short.
Pay up real quick,
Or I’ll see you in court!
Some companies require at least 30 days, or much longer, to pay. Some have legitimate reasons for this, and some don’t.
Repeat The Terms
The usage rights granted can be listed on the invoice. Don’t assume the customer still has your original estimate which stated these rights.
Similarly, repeat your Terms and Conditions either on the back of the invoice or on an attached second page. In either case, you need to indicate on the face of invoice that there’s more on the reverse side or on an attached page.
Since the invoice will be separated from the photos, usage rights should also be added to digital files as IPTC data. Usage rights should also be added as a text file on every disc containing the images.
Invoice Delivery
There’s no reason to wait before sending an invoice. When you buy anything, you have to pay right away. When your photography work is done, send the invoice.
The invoice can be sent with a cover letter, or e-mail, which includes the usage rights, a reminder that your Terms and Conditions are attached, and a thank-you to the customer for their business.
Every contact with a customer is a marketing opportunity. So your cover letter should include a casual “Please remember to call me for your next photo assignment” or something similar. Attach a business card if applicable.
Have customers make their cheque payable to your business, not to you. It’s more professional and it’s important to put incoming money through your business account to produce a cash flow.
Interim Invoices
If you have a photography assignment that will span many months, or longer, consider sending interim invoices. This is where you partially bill the customer, for example, at the end of each month. Interim billing allows you to have some cash flow rather than waiting many months to get paid.
Interim billing is especially important if you have a long-running job with high, ongoing expenses. You can’t be expected to carry large expenses for months. You’re a photographer not a bank.
Invoicing US Customers
Invoice foreign corporate customers in their currency, assuming they don’t have a Canadian office. Most larger businesses don’t want to be bothered with currency exchange. A few online invoicing systems can accept payment in multiple currencies and will do the exchange. But many currently don’t.
Be sure to prefix the currency in your estimate and invoice. Don’t just list $5,000. Explicitly state USD $5,000, as an example. The dollar sign ($) is used by 22 countries.
Foreign customers generally don’t pay Canadian sales taxes, but there are exceptions. When you list the tax on your invoice, don’t leave the line empty. Instead write “0%.” This shows that you didn’t forget, and you know the correct procedure.
US customers will most likely ask you to submit a W-8BEN form (for sole proprietors) or a W-8BEN-E (for corporations, partnerships). If a new US customer doesn’t ask for it, be proactive and submit one with your invoice. This may speed up payment. A completed form is valid for three years.
Download a W-8BEN (pdf).
A W-8BEN basically affirms that you’re not a US resident, don’t have a substantial presence in the US, and you’re a resident of a “beneficial” country (i.e. Canada) that has a tax treaty with the US. A completed W-8BEN means your US customer doesn’t have to withhold 30% for US income taxes.
If you’re a Canadian living in the US, then you’re subject to US tax and a W-8BEN won’t help. If you live in Canada, but for some reason have a US mailing address, a US bank account, and a US cellphone number, you may have problems getting your W-8BEN accepted.
Should a US customer asks for a W-9, remind them that you’re not a US resident (assuming you’re not) and submit a W-8BEN instead.
US Payments
If you get paid by US cheque, or any foreign cheque, Canadian banks can take up to month, or longer, to clear the cheque.
Canada’s Interac doesn’t exist in other countries, so there’s no quick and easy e-transfer from other other countries.
You can receive a wire transfer from another country, but it might be too troublesome for some companies. Ask if they can do it, and give them your banking information (bank name, SWIFT or FIN, routing or ABA number, transit number, account number). Your bank branch can give you the information you need based on which country is sending money. There are fees for a wire transfer.
When foreign currency is converted to Canadian dollars, the converted amount you received is your revenue, and not the amount listed in your invoice. Be sure to record what you received and what the exact exchange rate was.
You can, and should, add a small percentage to your fee, stated in both your estimate and invoice, to cover bank fees, transfer fees, and potential loss from fluctuating exchange rates.
