A proforma invoice (also written “pro forma” or “pro-forma”) is a preliminary invoice sent before goods are delivered or services are performed. It looks like an invoice but isn’t a demand for payment in the accounting or tax sense. Instead, it tells the buyer exactly what a final invoice will contain, so they can approve the purchase, arrange payment or prepare import paperwork.
Proforma vs. invoice vs. quote
| Quote | Proforma invoice | Invoice (commercial/tax invoice) | |
|---|---|---|---|
| Stage | Negotiation | Deal agreed, before delivery | Goods/services supplied or payment due |
| Purpose | Offer a price | Show the expected final bill; enable prepayment or approvals | Request payment; record the sale |
| Records income? | No | No | Yes |
| Tax document? | No | No — buyer can’t reclaim VAT/GST on it | Yes (if tax applies) |
| Numbering | Quote series | Separate proforma series | Official sequential invoice series |
| Can be changed? | Yes | Yes, until the final invoice is issued | No — corrections need a credit note |
In short: a proforma is a quote in invoice format, sent once the buyer is ready to commit, with every detail the final invoice will have.
When to use a proforma invoice
1. Requesting payment in advance
Many sellers require prepayment from new customers or for custom orders. The buyer’s finance team may need “an invoice” to release funds, but you don’t want to record a sale that hasn’t happened. A proforma solves this: they pay against the proforma, then you issue the real invoice when you deliver (or immediately on receipt of payment, depending on your local tax rules).
2. International trade and customs
Importers frequently need a proforma to:
- Apply for an import licence or permit
- Open a letter of credit with their bank
- Arrange foreign currency payments
- Give customs brokers advance information on value, weight and HS codes
For shipments, the proforma should contain the same information as the eventual commercial invoice: Incoterms (e.g. FOB, CIF, DAP), country of origin, HS tariff codes, net and gross weights, and packaging details.
3. Internal approvals
Large organisations often need a document to raise a purchase order or get budget sign-off. A proforma gives them a precise figure — including tax and shipping — to approve.
4. Samples and no-charge shipments
When sending samples across borders, a proforma (or a commercial invoice marked “No commercial value — samples”) states a value for customs purposes even though nothing is being sold.
What to include on a proforma invoice
- The title “Proforma Invoice” — clearly, so nobody books it as a real invoice
- A proforma reference number from a separate series (e.g.
PF-2026-007) — see invoice numbering - Issue date and validity date (“Valid until 30 Nov 2026”)
- Seller and buyer details, including tax numbers
- Item descriptions, quantities, unit prices and totals
- Expected tax (VAT/GST/sales tax), shipping, insurance and other charges
- Currency — critical for cross-border deals (see invoicing in a foreign currency)
- Payment terms and bank details if you expect prepayment
- For goods: Incoterms, estimated shipping date, weights, HS codes and country of origin
- A note such as “This is not a tax invoice. A final invoice will be issued upon shipment.”
Example proforma invoice
| Field | Example |
|---|---|
| Title | PROFORMA INVOICE |
| Number | PF-2026-007 |
| Date / valid until | 28 Oct 2026 / 27 Nov 2026 |
| Seller | Ceramica Rossi S.r.l., Via Roma 10, Faenza, Italy · VAT IT01234567890 |
| Buyer | Harbor Home Goods Inc., 220 Pier St, Portland OR, USA |
| Incoterms | FCA Faenza (Incoterms® 2020) |
| Description | HS code | Qty | Unit price | Total |
|---|---|---|---|---|
| Hand-glazed dinner plate, 27 cm | 6912.00 | 400 | €14.50 | €5,800.00 |
| Hand-glazed bowl, 16 cm | 6912.00 | 300 | €11.00 | €3,300.00 |
| Export packaging (pallets) | — | 2 | €120.00 | €240.00 |
| Total (EUR) | €9,340.00 |
VAT: 0% — export outside the EU (final invoice will reference the export). Payment: 50% advance by bank transfer, balance before dispatch. This is not a tax invoice.
(Company names, numbers and codes above are illustrative.)
What happens after the proforma?
- Buyer accepts and pays (fully or partially) based on the proforma.
- You deliver the goods or perform the service.
- You issue the final invoice with a number from your official invoice series. It should match the proforma unless something changed — if quantities or prices differ, the final invoice shows the actual figures.
- Show payments received: “Less advance paid 05 Nov 2026: −€4,670.00”. Balance due: €4,670.00.
- Issue a receipt if the buyer needs one (see invoice vs. receipt).
Tax and accounting points
- Don’t record a proforma as revenue. It isn’t a sale yet. Keep proformas out of your sales ledger and out of your invoice number sequence.
- Advance payments can trigger tax. In many VAT systems (including the EU and UK), receiving a payment before supply can create a tax point for the amount received, which may mean you must issue a VAT invoice for the advance. The rules differ by country and by whether goods or services are involved — check before relying on a proforma alone. See how to charge VAT on invoices.
- Buyers can’t reclaim VAT/GST using a proforma. They need the final tax invoice.
- Customs may not accept a proforma as the final declaration document; a commercial invoice is generally required when the goods ship.
Common mistakes
- Using your normal invoice numbering — this creates gaps or duplicates when the final invoice is issued.
- Leaving out a validity date when prices depend on materials or exchange rates.
- Forgetting shipping, insurance or duties, so the final invoice surprises the buyer.
- Labelling it “Invoice” without “Proforma” — the buyer’s system may record a liability twice.
Creating a proforma
BillKit’s quote generator is the quickest way to build a proforma: add your line items, title the document “Proforma Invoice”, set a validity date and include the “not a tax invoice” note. When the order is confirmed, create the final document with the invoice generator.
Rules about proforma invoices, advance payments and customs documents vary by country. This guide is general information, not legal, tax or customs advice.