Free pro forma invoice generator

How to make a pro forma invoice

1. Pick the reason for issue. Choose advance payment, customs or export, quotation for approval, or sample shipment. The reason is printed on the document.
2. Add seller and buyer. Enter both parties’ full legal names and addresses. For exports, add the buyer’s tax or EORI number in the notes where it applies.
3. Describe the goods or services. Describe each item clearly, with quantity and unit price. For goods that cross borders, add the HS code, country of origin and weights if known.
4. Set delivery terms and validity. Add the Incoterms rule, such as DAP London, and a valid-until date.
5. Check the total and advance paid. Add shipping, tax if applicable, and any advance already received. The balance is calculated.
6. Export and send. Download the PDF. When the goods are supplied, issue a proper tax invoice that replaces it.

What is a pro forma invoice?

“Pro forma” is Latin for “as a matter of form”. A pro forma invoice is a preliminary bill that describes a planned sale: what will be supplied, at what price and on what terms. It looks like an invoice but it is not a demand for payment in the usual sense and, in most tax systems, it is not a tax invoice. The final invoice is issued once the goods are dispatched or the service is done.

Sellers use pro forma invoices to ask a buyer for advance payment, to give customs authorities a value for goods in transit, to let the buyer arrange funding or an import licence, and to confirm a quote before production starts.

Because the document is a promise rather than a record of a completed sale, it should say so on its face. The generator prints a clear notice on every pro forma, which you can edit.

When to use one

• Prepayment. You want the money before you ship or begin, for example custom manufacturing or a risky new customer.
• Export and customs. Customs often wants a document showing goods, value and origin. Where a commercial invoice is required, use that for the shipment; pro forma documents are mainly for advance steps and approvals.
• Letters of credit and import licences. A buyer’s bank or authority may ask for a pro forma to open credit or approve an import.
• Samples and goods not for sale. Value shown for customs only, with a note such as “no commercial value”.
• Quotation for approval. The buyer can use it to get internal sign-off before issuing a purchase order.

Pro forma invoice versus tax invoice, quote and commercial invoice

The practical rule: a buyer cannot normally use a pro forma to reclaim VAT, GST or sales tax. When you are paid in advance, the date of supply or the “tax point” may still arise early in some systems. Check your tax authority’s rules on advance payments, and ask your accountant when you are unsure. Our guide to pro forma vs tax invoices goes further.

What to include

• The words “Pro forma invoice” and a notice that it is not a tax invoice or request for payment on a completed sale.
• Seller’s and buyer’s names, addresses and contact details; tax numbers where relevant.
• A unique pro forma number, issue date and valid-until date.
• Reason for issue, for example advance payment or customs.
• Item descriptions, quantities, unit prices, currency and total.
• For cross-border goods: HS code, country of origin, weight and packaging if known.
• Incoterms and the named place, such as DAP Rotterdam.
• Payment terms, bank details and how long prices are held.
• Any advance already received and the balance.

Worked example: advance payment before manufacturing

A small workshop in Canada will make 20 custom steel brackets for a buyer in the United States. It asks for 50% in advance.

Incoterm: DAP (named buyer’s address). When the goods ship, the workshop issues a commercial invoice for the same goods and shows the advance as already paid. Customs and tax treatment of the shipment is for the seller and buyer to confirm with the relevant authorities.

Common mistakes

• Calling it a tax invoice. A pro forma cannot be used to reclaim input tax in most systems.
• No validity date. Exchange rates and material costs move.
• Vague goods description. Customs wants plain descriptions, not internal part names.
• Leaving out Incoterms. Without them, freight and insurance responsibility is unclear.
• Not replacing it with a final invoice. Always issue a tax invoice on supply and reference the pro forma.
• Using it as a fake document. Do not use pro forma invoices to misstate the value of goods to customs or to mislead a bank.

Glossary

Pro forma invoice

A preliminary invoice issued before supply; not a tax invoice in most systems.

Commercial invoice

The final invoice for a cross-border shipment, used by customs.

Incoterms

ICC trade terms that set who pays for freight, insurance and risk.

HS code

The Harmonized System code that classifies goods for customs.

Tax point

The date a supply is treated as made for VAT or GST purposes.

EORI

An identification number used in the EU and UK for customs.

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