What is remittance advice and how does it work? Business Guide

As a UK business owner or anyone with responsibility for company accounts, it’s important to have a tight grip on cashflow. This means keeping close track of incoming and outgoing payments.

A useful document that can help you get an overview of when invoice payments will come in is remittance advice. But what actually is it and how does it work, and does your company need to send remittance advice when it’s paying invoices?

Find out everything you need to know in this handy guide, including what information is typically included with remittance advice.

We’ll also touch on a convenient and cost-effective way to receive invoice payments in multiple currencies with Wise Business.

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What remittance advice is and how it works

Remittance advice is essentially a proof of payment document sent by a customer to a business. It’s used to let the business know that an invoice has been paid, and so they can expect the payment to arrive soon.

Its name comes from the word ‘remit’, which means “to send back”. It’s used in the business world when referring to payments, including both bills and invoices.

The origins of the remittance advice slip hark back to the days when invoices and other payments were primarily made by cheque. The customer would include a remittance slip along with the cheque, so that the company would know what the cheque was for.

Benefits of sending/receiving remittance advice

Remittance advice offers a few key benefits for both parties, the customer and the business. This includes the following:

• It makes reconciliation easier, where payments need to be matched with invoices in accounting systems
• Cashflow management is easier, as businesses know when to expect an invoice payment
• It saves time having to chase up late payments, as the business has been informed that a payment is on the way
• It can help to build a positive working relationship, fostering good communication between the two parties.

Is remittance advice proof of payment?

While remittance advice is designed to be a proof of payment document, it doesn’t definitely prove that a payment has actually been made. It only says that the payment has been sent. It may be the case that there’s a problem, such as the wrong account details being entered when making the payment.

Businesses can use remittance advice to estimate and manage incoming payment schedules, but the only real proof of payment is the money arriving in the company’s bank account.

Does my business have to send remittance advice?

In today’s business world, most transactions and communications have gone online. This has made sending letters and paper documents of all kinds much less common, including remittance slips.

You don’t have to send remittance advice when you’ve paid an invoice, unless you’ve made an explicit agreement with the company which requires you to.

However, you may still want to send an email confirming that the payment is made. It’s professional, good practice and a courteous touch that the business will appreciate, which is important if you want to build a good working relationship with them.

What information to include with remittance advice

If you do decide to send remittance advice when you pay invoices, you’ll need to know what kind of information to include.

Here’s what is usually included in remittance advice:

• Your company’s name and address
• The supplier’s name and address (this is the business you’re paying
• The method of payment (i.e. bank transfer or PayPal payment)
• The total payment amount
• The invoice number
• The date of payment
• Any other reference numbers that may help the business identify the payment.

The above is typically included on paper remittance slips or letters - if you’re sending an email instead, you can simply confirm the amount and date of payment, along with the reference number used.

A final important piece of information to include on both paper and email remittance notifications is contact information. This should be a name, phone number and email address for the person within your company who the business can contact if they have any issues with the payment (for example, if it doesn’t arrive within the expected timeframe, or there’s an error with the amount).

How to send remittance advice

As we’ve discussed already in this guide, many businesses these days choose to provide remittance advice by email. These emails are usually pretty concise, as they’re simply designed to inform the business that the invoice has been paid. For companies which use accounting software, remittance emails may be issued automatically.

But if you’re sending a paper remittance note, you’ll need to do it on company headed paper. Many companies - especially large companies which regularly have invoices to pay - have standardised remittance slips already printed out (or in template form) ready to be completed. This slip will need to be posted to the business.

In many cases, you may receive a remittance slip along with the invoice. This is a common practice among established businesses in the UK. The slip is usually at the bottom of the invoice, and can be torn off, filled in and sent back.

Receive international payments with Wise Business

If your company is invoicing customers overseas, make sure to check out Wise Business.

It’s a powerful multicurrency account that can help UK businesses to get paid by customers in multiple currencies, with low fees and the mid-market exchange rate.

Your Wise Business account comes with local account details (only with Wise Business Advanced) to get paid in 8+ major foreign currencies like euros and US dollars just as easily as you do in pounds.

All you need to do is pass these account details (only with Wise Business Advanced) to your customer, or add them to invoices, and your customer can make a local payment in their preferred currency. You can also use the Wise request payment feature to make it even easier and quicker for customers to pay you.

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And that’s about it - your essential guide to what remittance advice is and how it works in the UK. You should now have all the info you need to start sending and paying invoices in confidence, and to set up remittance processes that work for your business.

Sources used: N/A

Sources last checked on date: 02-Aug-2025

*Disclaimer: The UK Wise Business pricing structure is changing with effect from 26/11/2025 date. Receiving money, direct debits and getting paid features are not available with the Essential Plan which you can open for free. Pay a one-time set up fee of £50 to unlock Advanced features including account details to receive payments in 22+ currencies or 8+ currencies for non-swift payments. You’ll also get access to our invoice generating tool, payment links, QuickPay QR codes and the ability to set up direct debits all within one account. Please check our website for the latest pricing information.