Invoice vs Payment Link: Which Should You Use?

If you've ever requested payment from a client, you've probably used an invoice. But you may have also heard of payment links as an alternative. Both accomplish the same goal — getting you paid — but they work differently and are suited to different situations.

What's the Difference?

Invoices

An invoice is a formal document that itemizes goods or services provided, along with the amount owed. It typically includes:

• Your business details (name, address, VAT number if applicable)
• Client's business details
• Unique invoice number
• Invoice date and due date
• Itemized list of products or services
• Subtotal, VAT (if applicable), and total
• Payment terms and bank details

Payment Links

A payment link is a URL that takes someone to a payment page showing:

• Who is requesting payment
• The amount owed
• A description of what it's for
• How to pay (payment details or integrated payment options)

Side-by-Side Comparison

When to Use an Invoice

Use a formal invoice when:

• You're VAT-registered — You're legally required to provide VAT invoices
• The client needs it for their records — Businesses often need invoices for their accounting
• You need to itemize multiple services — Complex projects with several line items
• You need a paper trail — For tax purposes or dispute resolution
• Corporate clients require it — Many companies only pay against formal invoices

When to Use a Payment Link

A payment link is perfect when:

• You need to request payment quickly — No time to create a formal invoice
• It's a simple transaction — Single service, clear amount
• You're dealing with individuals — Private tutoring, personal training, etc.
• You want to share via text or WhatsApp — Links work everywhere
• You're not VAT-registered — No legal requirement for formal invoices
• You're at a market stall or event — Quick, on-the-spot payments
• You want to track if the request has been seen — View tracking on payment pages

Real-World Examples

Use an Invoice:

• A web developer billing a company for a £5,000 website project
• A VAT-registered consultant billing for monthly retainer work
• A marketing agency sending an itemized bill for multiple services

Use a Payment Link:

• A tutor requesting payment for a £40 lesson
• A personal trainer collecting a £120 session package fee
• A plumber asking for £85 after fixing a leaky tap
• A graphic designer collecting a £150 deposit before starting work
• A craft seller at a market taking a £25 payment

Can You Use Both Together?

Absolutely! A common workflow is:

1. Send a payment link to collect a deposit quickly
2. Complete the work
3. Send a formal invoice for the final balance (with the deposit noted)

Or for regular clients who you work with often, you might use payment links for quick requests during the month, then send a consolidated invoice at month-end for their records.

The Bottom Line

There's no wrong answer — it depends on your situation. The best approach is often to use both tools where they make sense. The goal is the same: getting paid quickly and professionally.