Formal pre-sale commitment used for advance payment, LC-based export, buyer approval. Add expected delivery + advance %. Free PDF.
| Item | Qty | Rate | GST% |
|---|
A Proforma Invoice is a formal pre-sale commitment issued after the buyer agrees in principle. It is not a tax invoice (no tax liability is created) but it carries all the same financial details — party info, items, GST rate, advance payment terms, expected delivery. Buyers use it for budgeting, internal approval, LC opening (letter of credit), customs documentation for export, and visa or embassy filings showing proof of expected foreign exchange.
Quotation is informal — "here is what it would cost". Proforma Invoice is formal commitment pending payment/shipment. Tax Invoice (GST Invoice) is the legal post-shipment document that triggers GST payment and ITC claim. Proforma does not need to be reported in GSTR-1 (unlike tax invoice).
No. It is a pre-sale document and does not create tax liability or ITC entitlement. The actual Tax Invoice issued later is what counts for GST.
Yes — standard practice. Buyer uses the Proforma to open an LC with their bank, you receive advance against it. Final Tax Invoice is issued at the time of shipment.
Quotation is informal and non-binding. Proforma is formal and used after the buyer agrees — typically to initiate advance payment or LC.