Proforma Invoice Template

Proforma Invoice Templates

Here is everything you need to know about proforma invoice templates. What they are, how they work, what to put in them, and most importantly, how to create a proforma invoice using with one.

Pro forma is a latin term that means "for the sake of form" or "as a matter of form."

What is a proforma invoice template?

Proforma invoice templates are for people or businesses who need to send a preliminary invoice that shows a client the cost of goods or services before they are delivered and payment is due.

How does a proforma invoice template work?

A proforma invoice template works by providing an official document of goods and services agreed to be purchased from one party to another. The sending party fills in the proforma invoice template with all of the details regarding the upcoming transaction: including their contact info and their client's contact info, good and services provided, cost of items, taxes, discounts, deposits, terms, due date, invoice number, and anything else pertinent.

Proforma invoice vs. standard invoice vs. quote

A proforma invoice, standard invoice, and quote can contain similar information, but they are used at different stages of a transaction. A quote is usually provided early in the sales process to give a potential customer an estimated or proposed price. It helps the customer decide whether to proceed, but it isn't a request for payment and isn't recorded in the seller's accounting records.

A proforma invoice provides a more thorough preview of a proposed transaction. It often resembles a standard invoice and can include the buyer and seller details, proposed goods or services, prices, taxes, shipping costs, payment terms, delivery terms, and an estimated total. However, it isn't a demand for payment and shouldn't be recorded as accounts receivable simply because it was issued.

A standard invoice is issued when goods or services have been supplied or when an agreed amount has become due. Unlike a quote or proforma invoice, it formally requests payment and may be recorded as accounts receivable when the seller has an unconditional right to receive the amount.

Is a proforma invoice a request for payment?

A proforma invoice isn't a formal request for payment. It shows the expected details and value of a proposed transaction so the buyer can review the costs, arrange internal approval, confirm an order, apply for financing, or prepare for an international shipment.

The document may include proposed payment terms, deposit requirements, taxes, freight charges, and an estimated total, but these details don't mean the amount is currently due. A proforma invoice should be clearly labeled “Proforma Invoice” so it isn't confused with a final invoice.

Issuing a proforma invoice doesn't, by itself, create accounts receivable or recognize revenue. The seller should record accounts receivable only when it has an unconditional right to payment under the agreement and applicable accounting rules. Once the transaction is confirmed and the amount becomes billable, the seller can issue a standard or commercial invoice.

To make the purpose clear, businesses can include a note such as: “This proforma invoice is provided for information and planning purposes only. It isn't a demand for payment or a final tax invoice.”

When might customs require a proforma invoice?

A proforma invoice isn’t automatically required for every international shipment. When a completed sale has taken place, customs authorities generally use a commercial invoice to confirm the description and customs value of the goods and calculate applicable duties and taxes.

A buyer might request a proforma invoice before shipment to apply for an import permit or license, arrange a pre-shipment inspection, open a letter of credit, arrange foreign-currency payment, obtain internal approval, or organize shipping arrangements.

A proforma or substitute invoice may also be accepted or required in certain situations when a commercial invoice or other appropriate bill isn’t available. For example, U.S. customs regulations require a proforma or substitute invoice for certain entries when no invoice or bill is available.

For non-sale shipments, such as samples, gifts, replacement products, or goods supplied free of charge, some customs authorities or carriers may accept a proforma invoice. However, the goods must still be assigned an accurate customs value, and some destinations may require a commercial invoice even when no payment is involved.

Requirements vary by destination country, product, shipment purpose, and carrier. Before shipping, businesses should confirm the required documentation with the buyer, carrier, freight forwarder, or customs broker.

How to create a proforma invoice template?

You can create a proforma invoice template in three ways: From scratch (Hard), Using a template (Easier), and using an invoice generator (Easiest).

From scratch (The hard way)

The most complicated way to create a proforma invoice template is to create one from scratch using word processing or spreadsheet programs, like Microsoft Word or Google Sheets. You can even make one using a simple text editor or send an email or text message. But, that way doesn't look very good and may give a less than professional impression to your client so we will avoid it altogether.

What to include in your proforma invoice template

Include the following sections and information in your proforma invoice template:

1. Sender's information: your name or company name, address, and phone number.
2. Client information: your client's name or company name, address, and phone number.
3. Invoice number: An invoice number so you can easily refer to the invoice.
4. Date sent: the date you sent the invoice.
5. Due date: a due date to let the client know when they need to pay the invoice.
6. Reference number: a reference number if applicable.
7. Item name: the name of the goods and services provided
8. Item description: a description of the goods and services provided.
9. Item cost: the cost and quantities of the goods and service provided.
10. Quantity: the number of each item.
11. Line total: the item cost multiplied by the quantity.
12. Subtotal: the total amount of all items
13. Tax: any taxes (if applicable).
14. Discounts: Any discounts (if applicable).
15. Total: the subtotal, minus discounts, plus taxes.
16. Deposits: any deposits (if applicable).
17. Payments: any payments (if applicable - unlikely with a proforma invoice).
18. Amount due: Total, minus deposits, minus payments.
19. Terms: for official language like how to pay, how late payments are handled, and anything else of an official nature.
20. Notes. You can say things like, "Thanks for your business."

How to format and style your proforma invoice template

Once you have all of that information, create sections in your word processing or spreadsheet software to enter the data. Pay special attention to the layout and formatting. Do a print preview so you can see how it will look if you or your client prints the invoice. Triple check your calculations to make sure you are charging them the correct amount and have applied taxes, discounts, and deposits correctly. Style it with your choice of font, colors, and logo.

Save your proforma invoice template.

Once you are satisfied with your proforma invoice template, save it so you can use it again.

Send your proforma invoice template.

Now you can send it to your client by email, text message, or print and mail it. We recommend email or text since it is the fastest way to get the invoice to your client. Getting it in their hands faster is always a good idea.

The pros and cons of manually creating your proforma invoice template

Pros: you have complete control of the look and layout, and it doesn't cost you anything.

Cons: time-consuming, you need word processing or spreadsheet software, harder to stay organized, keep track of invoices, you need to perform calculations manually, you need to format an invoice manually, and it is difficult to know the invoice status.

Create an Invoice with Invoicer.ai

‍

Using a Template (Easier)

An easier way to create a proforma invoice is to use a premade invoice template like one of the ones at the top of this page. This way, all sections are already on it, and you need to enter your information and perform calculations.

For proforma invoice templates created using a spreadsheet program like Microsoft Excel or Google Sheets, the formulas should be in place, so you only need to enter the information, and the amounts are calculated for you. It is still good to double-check to make sure you are invoicing your client the correct amounts.

How to enter information into a proforma invoice template

Enter the following information in your simple invoice template sections:

1. Your name or company name, address, and phone number.
2. Your client's name or company name, address, and phone number.
3. An invoice number so you can easily refer to the invoice.
4. The date you sent the invoice.
5. Due date to let the client know when they need to pay the invoice.
6. A reference number if applicable.
7. The name of the goods and services provided.
8. A description of the goods and services provided.
9. The cost and quantities of the goods and service provided.
10. The quantity of each item.
11. The item cost multiplied by the quantity.
12. The total amount of all items
13. Any taxes (if applicable).
14. Any discounts (if applicable).
15. The subtotal, minus discounts, plus taxes.
16. Any deposits (if applicable).
17. Any payments (if applicable).
18. The amount due.
19. In terms enter how to pay, how late payments are handled, and anything else of an official nature.
20. In the notes section, you can say things like, "Thanks for your business."

Save and send it!

Once you are happy with your proforma invoice, save it and send it so you can get paid for your hard work.

The pros and cons of using a proforma invoice template

Pros: you only need to enter the information. you can style the template how you like. it is free.

Cons: still time-consuming, you need word processing or spreadsheet software, harder to stay organized and keep track of invoices, you need to perform calculations manually, and it is difficult to know the invoice status.

Using an invoice generator (Easiest)

By far the easiest way to create a proforma invoice is by using an invoice generator. An invoice generator guides you through the invoice creation process, performs calculations automatically, and makes it very easy to send and manage invoices. You can even receive online payments when payments are due!

Create a proforma invoice for free using the Invoicer.ai invoice generator

How to create a proforma invoice using an invoice generator

To create a proforma invoice using Invoicer.ai, watch the video above and follow the steps below.

Note, the information you enter is automatically saved for you so you do not need to enter it again. This is useful when you create new invoices for the same client and items.

1. Go to app.invoicer.ai
2. Enter your information into the invoice editor (note, click or tap the New Invoice button if you are not on the Invoice Editor screen)
3. The invoice is called INVOICE in the top left. You can edit this to whatever you like. For example, you can call it a RECEIPT or BILL OF SALE.
4. Enter your name or company name, address, and phone number.
5. Enter your clients name, address, and phone number.
6. The date issued is automatically populated with the date you create the invoice on. You can adjust as needed.
7. The due date is automatically populated 30 days (net 30) from the issue date. You can adjust as needed.
8. The invoice number is automatically populated. You can adjust as needed. Note, you cannot use the same invoice number twice.
9. Enter a reference value if needed (optional).
10. Under Description, enter the item name and details.
11. Enter the rate (amount of the item). You will notice the Amount Due automatically updates for you.
12. A default quantity of 1 is used. Adjust as needed.
13. Add a discount if needed as a percent or dollar amount. Note, you can add as many discounts as you want here and name them whatever you like.
14. Add tax. Note, you can add multiple taxes and name them whatever you want. We recommend adding your business tax number here if you have one. For example, GST (#12345678).
15. Add a deposit if needed as a percent or dollar amount. Note, you can add as many deposits as you want here and name them whatever you like. This is handy if you have a large job and need the client to send deposits as the work progresses.
16. Add a payment if you have received any. You can add multiple payments and their dates here.
17. Add notes.
18. Add terms.

Done!

If you haven't signed up yet you will need to create a free account to download a PDF and send your invoices. Once you are signed up you can access your invoices from any device.

Once you are happy with your invoice you can click View Stub to see what the stub view looks like. The stub view is a summary of the invoice and it is what the client sees when they view the invoice from email.

You can also click the PDF button to download and view a PDF version of the invoice.

If everything looks good, click the Send button to send your invoice to your client or email or text the PDF version.

The pros and cons of using an invoice generator

Pros:

• Save time and create invoices fast.
• Keep invoices and client profiles organized.
• Send invoices from anywhere, at any time.
• Track payments and send payment reminders.
• Make automatic calculations, and so much more.

Cons:

• Fewer customization options
• Cost money

The pros of using an invoice generator far outweigh the cons. The time savings alone are worth every penny with an affordable invoice generator like Invoicer.ai.

---

Proforma Invoice Templates FAQ

A proforma invoice is an essential tool for providing clients with a detailed estimate of costs before finalizing a sale. It helps both parties to stay aligned on the scope of work, pricing, and other terms.

This FAQ addresses common questions regarding proforma invoice templates, offering clarity on their purpose, customization options, and best practices for use so you can effectively utilize them in your business transactions.

Can proforma invoices be used as legal documents?

No, proforma invoices are not legal or binding documents. They are issued to provide an estimate or quote and cannot be used for accounting or tax purposes. A final invoice must always be issued for legal and financial transactions.

How should a proforma invoice be labeled?

To differentiate your proforma invoice from standard invoices, clearly label the document as "Proforma Invoice." This way, there will be no confusion about its purpose, and it will prevent it from being mistaken for a final invoice.

Can I include payment terms on a proforma invoice?

Yes, you can include payment terms on a proforma invoice to give your clients an idea of what to expect. However, keep in mind that these terms are not enforceable until they are included in a finalized invoice.

Is it necessary to include taxes on a proforma invoice?

It is recommended that applicable taxes be included on a proforma invoice to provide the client with a complete cost estimate. However, make sure that the tax rates on your proforma invoice comply with the laws and regulations of your jurisdiction.

What should I do if the client wants changes to the proforma invoice?

If a client requests changes to the proforma invoice, update the details accordingly and resend the revised document. Proforma invoices are flexible and meant to be adjusted before finalization.

Can I convert a proforma invoice into a purchase order?

Yes, you can. Proforma invoices can serve as a basis for creating a purchase order. Clients can use the information provided in the proforma invoice to generate a formal purchase order for the agreed-upon goods or services.

How long is a proforma invoice valid?

The validity of a proforma invoice depends on the terms set by the issuing business. It's common to include an expiration date or specify a validity period on the document to avoid misunderstandings about pricing or availability.

Should I issue a proforma invoice for every transaction?

Proforma invoices are often issued for large or complex transactions, international trade, or when the client needs a detailed estimate before proceeding. For smaller or straightforward transactions, a standard invoice may suffice.

Can I include shipping details on a proforma invoice?

Yes, including shipping details on a proforma invoice is common, especially for international trade. Information such as shipping method, estimated delivery time, and costs can provide the client with a complete estimate of the transaction.

‍

The bottom line

Creating a proforma invoice using a simple invoice template can actually be complicated, prone to errors, and come off as unprofessional!

It doesn't have to be. Use an invoice generator or a pre-made invoice template to save yourself time, look professional, and get paid fast.

Create an Invoice with Invoicer.ai

‍