Pro forma invoice: what is it?
Definition: What is a
proforma invoice?Partial invoice, final invoice, return credit note – we know it all. But a pro forma invoice is much less common. However, this does not always have to be the case. Because many companies have more and more customers in non-EU countries. And for them, the pro forma invoice is needed – at least sometimes.
Although the pro forma invoice (English, pro forma Invoice) has the component “invoice” in the word, it is actually not an invoice. Denn zu einer herkömmlicher Rechnung gibt es einen gewaltigen Unterschied: Sie fordern Ihren Kunden nicht dazu auf, eine Ware oder Dienstleistung zu zahlen. The pro forma invoice is only a receipt for goods that have been delivered to the customer or prospect. Therefore, it must not be confused with a commercial invoice or export invoice. This is because the latter is issued only for goods with a commercial value.
What is a pro forma used for?
So, you write a pro forma invoice when you want to ship goods with no commercial value. This includes for example:
- Sample deliveries
- Gift items
- Replacement deliveries or warranty cases
- Donations
- Goods that are not to be resold
- Deliveries against prepayment
It serves primarily as proof for customs to prove the value of the goods.
Data on a pro forma invoice
However, this does not mean that there are no formal requirements for the document. On the contrary, it must have the same contents as a commercial invoice:
- Designation of the document with pro forma invoice
- Your name and address plus other contact information
- Contact details of the recipient, specific contact person with telephone and fax number
- Delivery address; can be omitted if this is identical to the billing address
- Invoice number, place of issue and endorsement; depending on the intended use, different endorsements are possible. In the case of a sample delivery, for example, “Sample delivery – value for customs purposes only”.Liefer- und Leistungsdatum
- Description of the goods and quantity
- Single and total price
- Your VAT number
- Commercial register number and EORI number
- Packaging, insurance and transport costs
- Delivery conditions
Pro Forma Invoice Template & Sample Pro Forma Invoice Template
Beware of false statements
With this abundance of mandatory information, it’s easy to get the idea that the pro forma invoice can be converted into a traditional invoice with a few quick clicks.
But unfortunately, this is not possible either. Because this document must never become a real invoice. This is something you absolutely must keep in mind when issuing this type of document.
If you violate this regulation, it can cost you dearly. You could face not only a fine, but also criminal penalties. If the worst comes to the worst, you may even have to pay a debt to customs.
Better safe than sorry:
Create pro forma invoice with easybill
There are clearly far too many things to consider when it comes to pro forma invoicing? At the same time, the risk is too great that if you make a mistake, you will not only not be able to account for the goods, but also get into trouble with customs and tax.
Then don’t even take the risk!
Questions related to the pro forma invoice
Companies, freelancers, self-employed, small business owners, startups – they all have to write invoices. But every now and then, situations arise that may require a pro forma invoice.
Especially entrepreneurs who do a lot of business abroad and ship both goods and services to other countries are often dependent on pro forma proof.
A pro forma invoice is issued when the value of your shipment needs to be itemized and presented once for tax purposes. In the course of foreign business, deliveries of goods can thus be shipped duty-free.
Basically, the pro forma invoice does not differ from a regular invoice in terms of its preparation. However, it clearly indicates the title “proforma” and that payment is not necessarily expected.
No, a proforma invoice is not a proper invoice, in the sense of an invoice that is too regular to be entered in the accounts. It is, of course, a fiscally correct basis for calculating the value of goods for customs or the recipient company, but it does not trigger a mandatory payment charge.
The pro forma invoice can of course also be used as a prepayment invoice and would expect payment in this course. Like a prepayment invoice, it would thus be booked in the accounting. The actual commercial invoice, however, would be created in addition and would refer in terms of content to the pro forma invoice/prepayment invoice already issued in payment.
