How to invoice freight jobs: rates, extras and GST

By AJ Sakai, Director, TLH · Published

Most invoice disputes in transport aren't about the rate. They're about something the customer can't match to their own records: a missing PO number, a waiting time charge with no times, or a toll they didn't expect. A good freight invoice answers every question before it's asked, so it goes straight through the customer's accounts team.

This is how we invoice at our own fleet in Melbourne.

Step 1: put the customer's reference first

Every booking should carry the customer's own reference: their purchase order (PO), packing list or job number. Put it on the invoice where their accounts team will look for it, usually the reference field and the first line of the description.

If a booking comes in without a reference, ask for one before the truck leaves. An invoice the customer can't match to an order is the one that sits unpaid.

Step 2: show what the job was

One line per job, written so someone who wasn't there can follow it:

  • Date of the job
  • From and to, by suburb at least
  • Truck type, such as rigid, semi or crane truck, if your rates differ by vehicle
  • The basis of the charge: hours at an hourly rate, or a flat rate for the run

For hourly work, show the start and finish times your hours come from. Customers rarely query hours they can see.

Step 3: add the extras as their own lines

Keep each extra separate from the base rate, so the customer can see what it is and check it:

  • Fuel levy. A percentage of the base rate, with the percentage shown. See how to calculate a fuel levy.
  • Waiting time. The time on site beyond the agreed free time, with arrive and depart times. See waiting time charges.
  • Tolls. Charged at what you paid, with the road named, for example EastLink or CityLink.
  • Anything else agreed, such as a crane lift, a second driver or a tailgate.

If an extra isn't in your rate agreement with the customer, agree it before you bill it.

Step 4: get the GST right

Freight within Australia is a taxable supply, so GST applies to your charges. The ATO sets out what a tax invoice must show (ATO):

  1. That it's intended to be a tax invoice
  2. Your business name and ABN
  3. The date it was issued
  4. A description of what was supplied, with the quantity and price
  5. The GST amount, or a statement that the price includes GST
  6. How much of each line is taxable

For a sale of $1,000 or more, the invoice must also show the customer's name or ABN. If a customer asks for a tax invoice, you have 28 days to provide it.

Work out tolls and other costs you pass on without their GST, add them as lines, and let GST apply to the invoice total. Your accountant can confirm how this applies to your business.

Step 5: send it the same day

The longer an invoice waits, the longer you wait for your money, and the harder it is to answer a query about the job. Invoice as soon as the job is done and the proof of delivery is in. Combined runs, such as one interstate job split over two days, should still go out as one invoice.

Step 6: check what didn't get billed

Once a week, compare jobs done against invoices sent. Jobs that slip through are usually the unusual ones: a rebooked delivery, an add-on drop, or a job finished late on a Friday.

How TrakkHQ handles invoicing

TrakkHQ builds the invoice from the job record: the customer's reference from the booking, the times from the driver app and GPS, and the fuel levy, waiting time and tolls from your rate settings. Invoices go to Xero as drafts for you to check and send, so nothing reaches a customer without your OK.

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FAQ

Should I invoice per job or monthly?
Per job is easier to check and gets paid sooner. Some large customers prefer one monthly invoice; if so, list each job as its own line with its reference.

What payment terms are normal in transport?
It varies by customer. Many operators use 14 or 30 days; some large customers pay 30 days from the end of the month. Agree it upfront and put it on every invoice.

Do I need to show GPS times on the invoice?
Only if the customer wants them. Keep them on the job record either way, so you can answer a query with evidence.

Sources

This guide is general information, not tax advice. Check how GST applies to your business with your accountant.