Solicitor invoice template

How do solicitors usually invoice?

Solicitors issue a bill of costs rather than a plain invoice, splitting profit costs (their fee), VAT, and disbursements paid on the client's behalf, with the matter reference and the period of work. Conveyancing is fixed fee and settled from client money on completion; litigation and commercial work are billed monthly or at stages by the hour, with money on account taken first. The bill must comply with SRA rules on transparency and the client's right to challenge it.

Solicitors in this example give the customer 30 days to pay. Hourly rates run from £180 to £400.

What should a solicitor put on an invoice?

Beyond the legal basics, solicitors should:

• Separate profit costs, VAT and disbursements, and show which disbursements carry VAT.
• Quote the matter reference and the fee earner's hourly rate and time where billing hourly.
• Take money on account for litigation and show it as a credit on the bill.
• Include the statutory notice of the client's right to challenge the bill where required.

Every UK invoice, whatever the trade, must also show:

• a unique, sequential invoice number
• your business name and address (and company number if you trade as a limited company)
• the client’s name and address
• the invoice date and, for VAT invoices, the date of supply if different
• a clear description of each item of work or goods
• the amount due and when it must be paid
• your VAT number, the VAT rate per line and the VAT total, if you are VAT registered

Do solicitors charge VAT?

You only charge VAT once registered, which is compulsory when taxable turnover passes £90,000 in any rolling 12 months. Below that, show no VAT line and no VAT number. Once registered, these services are standard rated at 20% for UK clients; services to business clients outside the UK are generally outside the scope of UK VAT.

On the Flat Rate Scheme the sector for solicitors is usually “Lawyer or legal services” at 14.5% of VAT-inclusive turnover, with a 1% discount in the first year of registration. If you spend little on goods you may be a limited cost trader and have to use 16.5% instead. The scheme suits businesses with few VAT-able costs; check it against the standard method with the VAT calculator before joining.