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An invoice is a commercial document a seller issues to a buyer that itemizes goods or services provided and requests payment for them.
An invoice is a legally and commercially significant document that records a transaction between a seller and a buyer. It states what was supplied, the agreed price, applicable taxes, and the total amount payable. An invoice serves three roles at once: it requests payment, creates an accounting record for both parties, and provides documentation for tax authorities. Unlike a receipt — which proves payment has been made — an invoice is issued BEFORE payment to request it. Invoices are typically numbered sequentially, dated, and contain identifying details for both parties so they can be tracked, audited, and reconciled.
Issue an invoice as soon as goods are delivered or services are completed (or upon agreed milestones). For ongoing engagements, issue invoices at agreed billing intervals — typically weekly, fortnightly, or monthly. Always issue an invoice before payment, not after.
An invoice REQUESTS payment; a receipt CONFIRMS payment was made. The invoice precedes payment; the receipt follows it.
A quotation is an OFFER (price proposal before work) and is not yet a payment request. An invoice is a payment request after work is delivered.
In most contexts, "bill" and "invoice" are interchangeable terms, though "bill" is more common in retail/restaurant settings and "invoice" in B2B/freelance contexts.
Example: A freelance designer completes a logo project and issues invoice INV-2026-0042 to ABC Corp for "Logo design — 1 unit × $1,200" plus 18% GST ($216), totaling $1,416, due within 30 days.
An invoice on its own is not a contract, but it is a legally significant document that records a transaction. The underlying contract (verbal or written agreement to provide goods/services) is what is enforceable. The invoice serves as evidence of that contract being fulfilled.
In most contexts they are interchangeable. "Invoice" is more common in B2B, freelance, and professional services. "Bill" is more common in retail, restaurants, and consumer-facing contexts. Both request payment for goods or services rendered.
There is no fixed length. Most businesses use a format like "INV-2026-0042" (prefix + year + sequence) or "2026-0042". The key requirements are: unique, sequential, and never reused. Most accounting authorities require sequential numbering.
No. Invoice numbers should be unique across your business, regardless of which client receives them. Reusing or duplicating invoice numbers creates audit problems and can trigger tax-authority red flags.
Standard practice is to send invoices as soon as goods are delivered or work is completed. For long projects, send at agreed milestones. The sooner you invoice, the sooner you get paid — most consultants invoice the same day or the next business day.
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