How to create an invoice for the remaining balance due

Invoicing
Invoicing

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  1. Introduction
  2. What’s a remaining balance invoice?
  3. How to structure a balance due invoice
    1. Header
    2. Customer information
    3. Invoice details
    4. Balance summary
    5. Payment instructions
    6. Additional notes or terms
  4. Setting payment terms and due dates for the final balance
  5. Avoiding common mistakes when sending balance due invoices
    1. Forgetting to reference the original invoice
    2. Not setting a due date
    3. Being vague about late fees
    4. Sending invoices without payment instructions
    5. Poor formatting and lack of clarity
    6. Not following up on overdue payments
    7. Skipping balance details
    8. Omitting a personal touch
    9. Not using early payment incentives
    10. Ignoring automation options
  6. How to handle adjustments or disputes on remaining balance invoices
    1. Respond quickly to disputes or adjustment requests
    2. Clarify and correct any mistakes
    3. Provide a breakdown when needed
    4. Be open to reasonable adjustments
    5. Explain late fees or penalties
    6. Provide a payment plan for genuine hardships
    7. Escalate gently, if necessary
    8. Keep a record of every interaction
    9. Follow up once payment is resolved

Creating an invoice for a remaining balance due is an opportunity to finish a project smoothly and leave a positive, lasting impression on your client. Whether it’s the final instalment on a big project or a smaller follow-up payment, a well-structured balance due invoice can help you get paid faster, avoid unnecessary back-and-forth, and keep your client relationship strong. Nearly half of the invoices US businesses send out become overdue, but follow-up invoices can help speed up the payment process and avoid this common issue.

Below, we’ll explain how to create a balance due invoice, how to reference previous payments, how to display the remaining amount, and tips for including any extras, such as late fees and early payment incentives.

What’s in this article?

  • What’s a remaining balance invoice?
  • How to structure a balance due invoice
  • Setting payment terms and due dates for the final balance
  • Avoiding common mistakes when sending balance due invoices
  • How to handle adjustments or disputes on remaining balance invoices

What’s a remaining balance invoice?

A remaining balance invoice is a document a business issues to a customer to collect any unpaid portion of a previous bill. If a customer makes a partial payment or has an outstanding balance on an initial invoice, a remaining balance invoice itemises what’s still owed. It typically includes the original invoice details, any payments already made, the outstanding balance, and updated payment terms.

How to structure a balance due invoice

Your balance due invoice should be structured to show the customer what they owe, what the payment is for, and how they can contact you with any questions. Adding a summary at the top with the outstanding balance and due date helps customers quickly understand what they need to do next. Each section of your balance due invoice should be visually distinct with headers or bolded text for easy scanning. Here’s how to structure your invoice.

  • Business name and logo

  • Business’s email, phone number, and address

  • Invoice title (e.g., “Balance Due Invoice”)

Customer information

  • Customer’s full name or business name

  • Customer’s billing address, email, and phone number

Invoice details

  • Unique invoice number

  • Date of issue

  • The original invoice number for which a balance is still due

  • Itemised list of products and services

  • Remaining balance due date

Balance summary

  • Original invoice amount

  • Payments made and their dates

  • Outstanding balance

Payment instructions

  • Accepted payment methods

  • Online payment link or postal address for cheques, if applicable

Additional notes or terms

  • Late fees

  • Early payment discounts

  • Further payment instructions

Setting payment terms and due dates for the final balance

Setting payment terms and due dates for the final balance helps customers understand their obligations and plan their payments accordingly. Here are some tips for doing so:

  • For payment terms, state both the payment timeline (e.g., net 30, net 15) and the actual due date for maximum clarity.

  • State preferred payment methods – whether they’re credit cards, bank transfers, or cheques – and include any necessary payment instructions. If there’s a processing fee associated with a certain method, mention that as well.

  • Consider using late fee penalties and early payment discounts to incentivise timely payment. For late fees, businesses will often charge a small percentage (e.g., 1%–2%) for each month the payment is overdue. Mention when this late fee applies (e.g., after a 10-day grace period). For early payments, businesses might offer a 2% discount for payments received within 10 days of invoicing.

Avoiding common mistakes when sending balance due invoices

Sending balance due invoices requires careful attention to detail. Missteps can delay payments or confuse clients. Here are some common mistakes and tips on how to avoid them.

Forgetting to reference the original invoice

Failing to include the original invoice number or payment history can make it difficult for the client to track the balance due. Always reference the original invoice number and list any payments already made.

Not setting a due date

Stating general terms such as “net 30” or “due soon” without a specific date can cause confusion. Always include an actual due date to minimise misunderstandings about payment timelines.

Being vague about late fees

Not mentioning late fees up front can frustrate customers. Outline any late fees in the payment terms section of the invoice. Specify both the rate (e.g., 1.5% monthly interest) and when it will begin to accrue so customers know exactly what to expect.

Sending invoices without payment instructions

Omitting payment instructions makes it harder for clients to pay and can delay processing. Include details on accepted payment methods (e.g., bank transfer, credit card, cheque), with all necessary account or link information. Mention fees associated with certain methods (e.g., credit card processing) to avoid surprises.

Poor formatting and lack of clarity

Sending an invoice that’s cluttered or poorly formatted can lead to confusion and payment delays. Use a structured format with headings and easy-to-read sections for balance due, payment history, and terms. Highlight or use bolded text for the remaining balance and due date so they stand out.

Not following up on overdue payments

Set reminders to follow up with clients a few days before the due date and again immediately after, if the invoice becomes overdue. Tools such as Stripe Invoicing can automate friendly reminders and follow-up emails.

Skipping balance details

Not including an itemised summary, even if it was on the original invoice, can make the client question the balance. List the items or services that the remaining balance covers to avoid disputes and reassure clients about the legitimacy of the charge.

Omitting a personal touch

Sending a purely transactional message can come across as impersonal, especially if the client had issues or questions with prior invoices. A simple line such as, “Please let us know if you have any questions about this balance or need assistance with payment,” adds a personal touch and shows you’re open to addressing any concerns, which can foster goodwill and encourage prompt payment.

Not using early payment incentives

If early payment would benefit your company, consider including a small discount (e.g., 1%–2% if paid within 10 days). This can encourage faster payments without much financial impact.

Ignoring automation options

Manually tracking balance due invoices can lead to errors, delays, and missed follow-ups. Consider using invoicing software like Stripe Invoicing for automated invoicing features, including payment tracking and reminders.

How to handle adjustments or disputes on remaining balance invoices

A friendly, solution-oriented approach can help you handle disputes. Responding promptly and being transparent about your pricing and process shows clients they’re valued, even during difficult conversations. Here are some tips for managing this process.

Respond quickly to disputes or adjustment requests

When a client questions a balance, respond quickly. Review their concern in detail, whether it’s a potential billing error or an issue with the product or service itself. This shows clients you’re taking them seriously and keeps the process moving for both parties.

Clarify and correct any mistakes

If there’s a mistake in the invoice (such as a duplicate charge or incorrect rate), fix it and send an updated invoice reflecting the corrected amount – potentially with a quick explanation for the adjustment. A transparent correction can prevent confusion and shows you’re proactive about getting things right.

Provide a breakdown when needed

If the client wants more detail, share an itemised list of charges, including previous payments and what’s covered by the balance. Often, seeing everything laid out can resolve confusion immediately.

Be open to reasonable adjustments

If the dispute is about the quality of the work or extent of the service, consider offering a solution such as a partial credit, a discount on future services, or an adjusted rate. Your flexibility will show the client you’re invested in their satisfaction and can often strengthen relationships and lead to repeat business.

Explain late fees or penalties

If late fees are part of the balance and the client is questioning them, clarify your payment terms. Explain the purpose behind the fees, and if the client has a good history with you, consider a one-time waiver. It’s much easier for clients to accept late fees when they understand their purpose, and a goodwill waiver (when it makes sense) can also reinforce a positive client relationship.

Provide a payment plan for genuine hardships

If the client is struggling to pay, consider implementing a payment plan that enables smaller, staggered payments. A payment plan can help you recover the balance over time without damaging the client relationship. Document the arrangement so everyone’s on the same page.

Escalate gently, if necessary

If the dispute is ongoing and won’t resolve easily, it might be time to gently escalate. Escalation can add urgency to the situation and often encourages faster resolution. Involve a senior team member or use a mediator if the balance is substantial. As a last resort, and only if necessary, consider using a collection agency.

Keep a record of every interaction

Save all emails, call notes, or summaries of any meetings related to the dispute or adjustment. Documentation helps you stay consistent in future follow-ups and protects you if questions come up later.

Follow up once payment is resolved

After the balance is settled (or a payment plan is in place), send a short follow-up message that thanks the client for working through the issue and summarises the final agreement. A final touchpoint makes a positive impression and ensures the matter is fully closed.

The content in this article is for general information and education purposes only and should not be construed as legal or tax advice. Stripe does not warrant or guarantee the accuracy, completeness, adequacy, or currency of the information in the article. You should seek the advice of a competent lawyer or accountant licensed to practise in your jurisdiction for advice on your particular situation.

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