How to pay an invoice
Check it is genuine, check it is right, and use the invoice number as the reference. What to do when it is wrong, disputed, or you cannot pay on time.
Almost everything written about invoices is written for the person sending one. This is the other side: an invoice has arrived, and you have to decide whether to pay it, how, and what to do if something about it is wrong.
The order matters more than it looks. Checking comes first, because the one mistake that cannot be undone is paying the wrong account.
Check it is real before you check it is right
Invoice fraud works because a real invoice and a fake one look identical. The usual method: somebody gets access to a supplier's mailbox, or spoofs their address, waits for a genuine job to finish, and sends the genuine invoice with one field changed — the bank details. Everything else is correct, because everything else is real.
Two habits defeat almost all of it:
- Treat any change of bank details as fraud until proven otherwise. A legitimate supplier changes their account roughly never. If the details differ from last time, stop.
- Verify by voice, on a number you already had. Not the number on the invoice, not the number in the email signature, not a number in the reply. Both of those are controlled by whoever sent the invoice. Use the number from your own records, or the one on their website.
Also worth a second look: an unfamiliar sender address that is one character off, a first invoice from a supplier you have not agreed to work with, unusual urgency, and an amount just below whatever threshold triggers approval where you work. Fraud is calibrated to slip under the check, not to look dramatic.
Then check it is right
Five questions, in the order that catches the most:
- Did we agree to this? Match it to a purchase order, a contract, a quote or an email. An invoice with nothing behind it is not automatically wrong, but it is the one to ask about.
- Is the amount what was agreed? Including whether tax has been added on top of a price you understood to include it.
- Was the work actually delivered? Somebody who would know should confirm it, not the person processing the payment.
- Is it a duplicate? Search your records for the invoice number and the amount. Paying the same invoice twice is more common than paying a fraudulent one, and much harder to recover.
- Does it have what it needs? A unique invoice number, both parties named, a date, a due date, and tax shown separately — see what an invoice must contain. A missing number is the usual reason an invoice cannot be entered at all.
How to pay it, and what to write in the reference
Bank transfer is the default for business-to-business, and the only part people get wrong is the reference.
Put the invoice number in the payment reference. Only the invoice number. Not your own name, not "payment", not the project. The supplier reconciles by matching payments to invoice numbers, and a payment that cannot be matched sits in a suspense account while you get chased for an invoice you have already paid. If the field is long enough, invoice number and your company name is ideal.
Card payments cost the supplier a percentage and are worth using when speed matters more than their margin. Direct debit is worth setting up only for recurring, predictable amounts. Cheques still exist and clear slowly enough that the due date should be counted backwards from.
Pay on the due date, not before and not after. Early payment is a gift with no recipient; late payment, in much of the world, entitles the supplier to statutory interest whether or not your contract mentions it — how to send an invoice sets out what those rights actually are, and they apply to you as the payer.
Send a remittance advice
A remittance advice is a short note saying what you have paid and what it was for. It is not required and it removes an entire category of follow-up.
Hi Levan — we have paid INV-014, 1,200 GEL, sent today from our Bank of Georgia account. It should land tomorrow. Reference: INV-014.
If you are paying several invoices in one transfer, list every invoice number and its amount. A single lump sum against six invoices is unmatched money, and the supplier will have to ask.
When something is wrong with it
| The problem | What to do |
|---|---|
| The amount is wrong | Ask for a corrected invoice or a credit note. Do not edit it and do not part-pay silently. |
| Part of it is disputed | Pay the undisputed part on time, in writing, and say exactly what is held and why. This keeps you out of late-payment territory on the rest. |
| It is a duplicate | Tell them the number of the one you already paid and the date. Usually it is their reconciliation, not their honesty. |
| It has no invoice number | Ask for one. You may not be able to enter it at all, and neither can your auditor. |
| You cannot pay on time | Say so before the due date, with a date you can meet. A supplier who is told can plan; one who is ignored escalates. |
None of these is a reason to go quiet. Silence from the payer is read as refusal, and it is what turns an administrative problem into a relationship one.
Keep the record
Keep the invoice itself, not the email it arrived in — the PDF, filed under a name that includes the supplier and the number. Most tax authorities require several years of purchase records, and the invoice is what proves the expense and, where you can reclaim it, the tax on it. A screenshot of a payment is not a substitute: it proves money moved, not what it bought.
If you also send invoices, invoice numbers explains the sequence rules from the other side, and the free invoice generator will write your own.