Proforma Invoice vs Tax Invoice
Last updated: 2 July 2026 · 5 min read
These two documents look similar but serve different purposes at different stages of a sale.
| Proforma invoice | Tax invoice | |
|---|---|---|
| When issued | Before the sale is confirmed | At or after supply |
| Purpose | Quote expected cost | Demand payment; legal GST record |
| Creates tax liability? | No | Yes |
| Enables ITC? | No | Yes (for the buyer) |
How to use each
Send a proforma invoice so the buyer can approve the cost and arrange funds. Once confirmed, issue the tax invoice — this is the document that goes into your GST returns and lets the buyer claim input tax credit.
FAQ
Is a proforma invoice legally binding?
No. It is provisional and creates no payment or tax obligation; the tax invoice is the legal document.
Related: proforma generator, quotation generator, GST invoice format.
For informational purposes only. Verify with the official GST portal or a qualified tax professional.