What is Receipt?

A receipt is proof of payment — a document confirming that money has changed hands. For freelancers, issuing receipts is a professional practice that helps both you and your clients maintain accurate financial records.

A receipt should include:

• Your name or business name
• The client's name
• The date payment was received
• The amount paid and payment method
• A description of the goods or services paid for
• A reference to the related invoice number
• Your VAT number and VAT breakdown (if VAT-registered)

When should you issue receipts?

• When a client pays in cash (essential — there is no other paper trail)
• When a client specifically requests a receipt
• When you want to confirm payment for your own records
• For point-of-sale transactions

Many freelancers who invoice clients rely on bank transfer confirmations rather than issuing separate receipts. However, marking an invoice as "Paid" and sending the updated version to the client serves a similar purpose and is considered good practice.

For tax purposes, you should keep all receipts for business expenses as evidence of deductible costs. HMRC requires you to retain records for at least five years after the filing deadline. Digital copies (photos or scans) are acceptable.