In other words, it documents the sale terms, but it doesn’t demand payment. It generally marks the details of the transaction, including the price, quality and quantity of the product, payment, delivery terms, etc. Pro forma Invoice V/S Commercial InvoiceĪ pro forma invoice is a quotation bill. They are also used in all industries to satisfy the internal purchase approval process.Ĭommercial Invoice helps customs authority determine the duties and taxes for the shipment and evaluate if it meets all the requirements, this aids in preventing delays in the delivery. Pro Forma Invoice helps customers decide whether to place an order.
It provides an estimate of any applicable taxes or transport charges. The purpose of a pro forma invoice is generally considered a “good faith” agreement to let the customer know what to expect. Considering the complex nature of these invoices, exporters tend to get confused about when to use them, leading to issues in closing the transaction and in customs clearance. One of the most important processes in invoicing is generating a pro forma invoice and a commercial invoice. Invoicing can be a tedious process, especially for cross-border transaction.
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