Recurring Invoices (Basic): Create, schedule, save as draft

With recurring invoices, you can request payment authorization from your clients and get paid automatically at routine intervals. This can help you with all your clients who order services on a consistent basis. Here, find out all the details about creating recurring invoices.

Covered here:

• Creating and sending recurring invoice
  • Invoice type
  • General
  • Recurrence settings
  • Payment authorisation
  • Additional
  • QuickBooks settings
  • Line items & Summary
  • Note to client
  • Payment schedule
• Customizing recurring invoice
• Saving recurring invoice as draft
• Duplicating recurring invoices
• What clients see when you create recurring invoices
• Who can sign a recurring invoice
• What happens if the client signs after the first invoice date
• What happens if an automatic payment fails?

Creating and sending recurring invoices

Recurring invoices can be created and sent by a firm owner or any team member assigned to the account with access rights to manage invoices. 

You can create recurring invoices alone or include them in your proposals or proposal templates. You can also create recurring invoices from the services listed in the proposal.

Follow these steps:

1. Click New at the top left, then select Invoice from the slide-out. You can also add an invoice to the proposal.

2. Select the account for which the recurring invoice should be issued.

3. Set the Invoice type to Recurring, then either enter a Name for it (choose a client-facing name for invoices with payment authorization) or select a template. If a template is selected, then proceed to step 7.

4. Select how often the invoices should be sent (set to Monthly by default) and how many times they should recur.

5. Choose a payment method: this is how you want your invoices to be paid (either by credit card, bank debit or both)

6. Enter the amount of each invoice either by entering it into Subtotal or adding up the line items.

7. Then click Create to send the invoice. Once a recurring invoice with payment authorization is accepted, a notification is sent to your email and Inbox+.

Also, there are other details you may want to include. The  Create Invoice window is split into several sections:

• Invoice type
• General
• Recurrence settings
• Payment authorisation
• Additional
• QuickBooks settings
• Line items & Summary
• Note to client
• Payment schedule

Invoice type

The  Create invoice window is common for one-time and recurring invoices. Click Recurring to switch to the recurring one.

General

1. Account name, ID or email: Select the account where the invoice will be sent.
2. Invoice template: Click and select one of the recurring invoice templates you’ve created from the drop-down menu. Recurring invoice templates are especially useful for invoices you send to clients on a regular basis.
3. Name: The name of the recurring invoice (e.g. Bookkeeping 2023 or Financial Planning 2024). The client will see it only for recurring invoices with payment authorization. 
4. Choose a payment method: This is how you want your clients to pay invoices (either by credit card, bank debit or both). We support a number of payment methods.
5. Team member: Select the team member who is responsible for receiving the payments (by default, it is the person who creates the invoice).
6. Description: Add a description outlining what is included in the invoice. You can use account shortcodes based on custom fields and date shortcodes. Here's more on shortcodes.

Recurrence settings

1. Choose payment method: Accept payments upon acceptance (for recurring invoices with payment authorization only) or on a specific date. If Specific date is chosen, you need to select it under First invoice date.
2. First invoice date: Date of sending the first invoice.
3. Recurrences: Enter how many invoices you want to send.
4. Recurrence: Select a time interval between invoices. It can be one of the list (e.g., monthly or yearly), or you can set a custom interval.

You can review and edit the invoice recurrence settings anytime by going to your  Recurring invoices list and opening it.

Here are some examples of what you will get by selecting different schedule settings :

Custom schedules

Custom schedules allow you to tweak recurring invoice schedules even more, depending on your needs. Schedule invoices to recur at whatever frequency you want, e.g., on the 25th every 4 months, bi-monthly, every second Tuesday, etc.

To set up the custom recurrence settings, select  Custom in the Recurrence drop-down.

Here are the options to set to create custom schedules:

• Starts on: This is when the first invoice will be sent to the client after they have agreed to the recurrence. This may be on a specific date or on acceptance.
• First invoice date: the date when the first invoice will be created (available if Specific date is chosen).
• Issue invoice every: the number of time periods between each invoice.
• Time category: this field specifies the time period — days, weeks or months.
• Number of recurrences: the number of invoices to be sent.

You will also see the expiration date, which is the date when the last invoice should be paid according to the schedule.

Payment authorization

Select one of the options:

1.  Automatic payment: After the client accepts the recurring invoice terms, invoices will be issued according to your schedule, and the client's card/bank account will be charged automatically. This option is available for Stripe only.

2.  Manual payment of invoice: Invoices will be issued and sent to the client according to your schedule, but they will need to pay them manually each time.

Automatic payment

When automatic payment is selected, the client authorizes the payment once, and all the next payments happen automatically. Let's see what it looks like on the client side:

1. The firm owner or team member prepares a recurrent invoice. The client receives an email and sees a pending notification in the Waiting for action section of the Billing page.

2. The client with signatory authority reviews the terms, submits payment details, and then signs and accepts the recurring invoice.

Once this is done, the card/account will be charged automatically according to the schedule outlined in the recurring invoice.

Attention! To use this type of authorization, Stripe should be selected as the default payment provider.

Manual payment of invoice

When the manual payment of invoices is chosen, invoices are issued and sent to the client according to your schedule, and clients need to pay the invoices manually each time. If you have CPACharge selected, you cannot select payment authorization, and manual will be the only option.

All issued invoices will work as one-time invoices — they will be shown on the Billing > Invoices page. If QuickBooks is connected, they will be synchronized within a day of being issued. At the same time, the schedule will be available for review and editing in the Recurring Invoices tab. 

Let's see what it looks like on the client side:

1. The firm owner or team member prepares a recurring invoice, and the client receives a notification on each invoice issued. When manual payment is selected, the client doesn't see the invoice as recurring on their side. 

2. The client pays the invoice manually as they would a regular invoice.

3.  When a certain date comes up, a new invoice is issued to the client according to the schedule, and they have to pay it manually once again. This is repeated until all invoices are sent according to the schedule.

Additional

Note that you will see this section only if you use Stripe and you have enabled payment authorization.

In the Additional section, you need to add details only if you turn the toggles on:

1. Email invoice to client: This message will replace the default text in the email system notification sent along with the invoice. The email won't be accessible to you after you send the request. To reuse it, consider adding it to the invoice template. You can also use account shortcodes based on custom fields and date shortcodes.

2. Reminders: Toggle this onto send an email notification to the client if they haven't paid the invoice within a specified number of days. Here's more on reminders.

QuickBooks settings

Select  Location and Class for the invoice to be sent to QuickBooks. Clients will not see this field. 

Note that the QuickBooks settings section is displayed only if you turn it on in QuickBooks. To do it, go to Account and Settings > Advanced > Categories and turn on tracking locations and/or classes.

Line items & Summary

Both  Line items and Summary show the invoice amount. If you don't want to include a detailed description of your services and the rate, you can go straight to the Summary section and fill in the amount.

Otherwise, you can create a client-facing itemized list of products and services you are providing in the  Line items section. All data from this section will also be automatically added to the Summary section.

In the Line items section, you can:

1. Add line item: Click Line item, then either select an existing service or create a new one. Fill in the Rate field, set the number of services and tax (here's more on tax rates in invoices), and type in the Description (optional). Select Class to be sent to QuickBooks (clients will not see this field).
2. Apply discounts: To add a discount line item, click Discount, then fill in the Rate field. 
3. Manage line items: Click the trash bin icon to delete a line item. Click three dots to edit, duplicate, delete or create a new service from it.
4. Settings: Click Settings to determine which columns will be displayed in your invoice. 
   If the  Description and Service date fields are empty and you didn't hide them, they will automatically be hidden from the invoice. There is a different logic for the Rates & Qty and Tax columns: you should hide them in Settings so they are not displayed in the invoice, even if the value is set to 0. 

Summary lets you see:

• Subtotal: This is the sum of the amounts for the services provided before tax. You can edit it if you don't have any line items. After you add them, it is calculated automatically and can't be changed.
• VAT rate: If you don't have line items, you can edit the VAT rate. If you have line items, to edit the VAT rate, you need to enable the VAT column for the line items (here's more on sales tax).
• VAT amount: Calculated automatically from Subtotal x VAT rate.
• Total: Calculated automatically from Subtotal + VAT amount.

Additionally, in the end, after the Payment schedule section, you can review the main settings of the recurring invoice: the number of payments you are expecting, the amount of each, and the total amount.

Note to client

You can add Note to client and personalize it using shortcodes. It can be either a note with the payment details or just a message. This note will be displayed in the client portal and in the PDF invoice.

Payment schedule

Review the dates when each of the invoices will be sent.

Saving recurring invoice as draft

Preparing a recurring invoice may take time in some cases (e.g. if you are still working out the terms with the client). You can save all your changes by clicking Save as draft without sending this invoice to your client.

Once done, you will be able to find the recurring invoice in the Inactive tab of the Invoices > Recurring Invoices page. These invoices are marked as Draft.

To view draft invoices for a specific client, go to  Clients, select the account, then go to the Recurring invoices subtab of the Invoices tab from their profile. The Invoices tab in the client’s profile is available to the firm owner, admin or any team member with the Manage invoices access right.

When the recurring invoice is saved as a draft, you can still review it and add or delete fields. However, the draft invoice will not be visible to the client until you hit  Create.

Note! The balance column for draft invoices will display $0.00 until you create and send the recurring invoice. Balance is the sum of unpaid invoices in the recurrence.

Duplicating recurring invoices

To create a copy of an existing recurring invoice, go to the Invoices > Recurring invoices page or the Recurring invoices subtab of the client account's Invoices tab, click the three dots to the far right of the invoice name and select Duplicate.

You will see the Create invoice page with all the details of your original invoice already filled in. Click Create or edit it the way you see fit.

What clients see when you create recurring invoices

Your client can view and sign recurring invoices by either clicking the notification on their dashboard, clicking the link in their email notification, or clicking the link on the Billing page of their portal. 

Then, they will be presented with a simple form where they will be able to review the details, add payment information, and sign. 

If you want to see TaxDome how the client sees it, access a read-only view of their portal.

Who can sign a recurring invoice

When you send a recurring invoice, all contacts linked to the account with the signatory authority enabled are allowed to sign from their client portal. 

Only one contact needs to accept the recurring invoice to make it active. So, make sure that signatory authority is disabled for the contacts that are not allowed to sign (e.g. children).

What happens if the client signs after the first invoice date

If a client signs a recurring invoice with payment authorization after the first invoice date is passed, all missed invoices will be generated and automatically charged to the client. For example, if the recurring invoice starts on September 25th but the client signs it on October 26th, they will be charged for missed invoices from both September and October.

If the client's selected payment method does not have sufficient funds, TaxDome will make multiple attempts to charge payments. However, the client will always have the option to pay the invoices if they choose to do so manually.

What happens if an automatic payment fails?

If there are any issues with payment processing such as insufficient balance in the client's bank account or other processing errors that prevent the payment from going through, the system will automatically attempt to retry the payment up to four additional times:

• 4 hours after the first unsuccessful payment
• 24 hours after the last attempt
• 48 hours after the last attempt
• 72 hours after the last attempt

If all four attempts are unsuccessful, the client will have to update their payment details. Once they have done so, future payments will be charged automatically.

Note! For bank debit payments, the standard processing time is up to 30 days, which is ample time to ensure that the payment is processed successfully. If the payment fails during this time, it will be retried once the  payment status changes from "Processing payment" to "Failed."