Proforma Invoice Format & Free Maker

What is a proforma invoice?

A proforma invoice is a preliminary bill sent before goods or services are supplied. It shows the buyer what they will be charged, including GST, and is often used to get an order approved, arrange an advance payment or support a loan or subsidy application. It is not a tax invoice, so it creates no GST liability for the seller and no input tax credit for the buyer. hisabkitab’s free maker lets you create one in the same layout as a GST invoice.

What should a proforma invoice include?

A useful proforma carries:

• The words “Proforma Invoice” clearly at the top

• Your business name, address and GSTIN, and the buyer’s details

• A proforma number and date, and how long the prices are valid

• Item description, HSN or SAC, quantity, rate and discount

• The GST rate and amount, and the expected total

• Payment terms and bank details for an advance

Proforma invoice vs tax invoice

The proforma is a commitment to a price, not a record of a sale. Once the goods are supplied or the service is provided, you issue a tax invoice with its own invoice number, and that is what goes into GSTR-1. Never number proformas in the same series as tax invoices.

What if the buyer pays an advance against a proforma?

For services, GST is payable when an advance is received, so issue a receipt voucher for the advance and adjust it against the final tax invoice. For goods, GST on advances does not apply, and tax is paid when the invoice is issued on supply.