Many times the terms invoice and receipt confuse us. Though both are business accounting documents, both hold different definitions and importance. 

You might have come across the terms’ invoice’ and ‘receipt’ while managing your business accounts. And you might have thought that is an invoice a receipt?

You also might be knowing that they relate to the document about the transaction or trade between two parties. Both are non-negotiable commercial instruments used while a product/goods or service is rendered from one party to another. But there is a thin line of difference in these two terms.

So, what’s that?

Let us look at both of them and understand how and when to use them in business.

What is an invoice?

What is an Invoice

An invoice is a commercial business document. 

An invoice can be explained as a document (bill) with the itemized list of goods/products/services rendered by the business owner (seller) to the client (buyer). Usually, an invoice or bill is issued with details such as getting paid within a stipulated period.

It is a proof of sale and generally includes the total amount due, due date, contact information of the businesses involved, discount, tax information, and place of delivery.

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Types of invoices

A commercial seller issues different invoices to the buyer against the proof of purchase. Let’s discuss these invoices to have a clear invoice and receipt difference. 

  1. Commercial invoice
  2. Final invoice
  3. Interim invoice
  4. Expense report
  5. Credit note
  6. Debit note
  7. Pro-forma invoice
  8. Past-pending invoice
  9. Time-log invoice
  10. Recurring invoice
  11. Mix invoice
  12. Standard invoice

All these different types of invoices are used for different purposes. For example, a proforma invoice is sent before the sale is completed. It is mainly used in the industries where the buyer needs proof of sale for transportation goods, such as the import-export sector. In the import-export industry, a proforma invoice is issued by the seller in advance of the payment being received from the buyer to ensure the successful clearance of the goods from the port. 

When should a seller issue an invoice to the buyer?

When Should a Seller Issue an Invoice to the Buyer

There are many ways to send an invoice to your buyer, customer, or client. But yes, it is best to send an invoice in a professional format to help them clarify their doubts. Also, a professional invoice creates a good impression. 

Apart from getting detailed information on the invoice and receipt difference, it is best to know when to send an invoice and receipt. 

There are three best times to issue an invoice to your clients.

  • For first-time buyers or clients or short-term projects: Issue an invoice before the work starts or in the middle of the project/sale.
  • For loyal clientele: Issue an invoice after the work or product is delivered.
  • Go with the flow. Do as discussed with your clients in the deal. Start the work with an advance and send the balance invoice at the end of the project. 

Do you wish to make quick receipts online?

What is a receipt?

What is a Receipt

A receipt is not an invoice. It is different from a commercial or standard invoice. 

A receipt is another kind of document that is proof that the invoice mentioned above is paid in full by the buyer or customer. An invoice is generated before the payment is made, and the receipt comes after the payment has been made. If the question still arises, an invoice a receipt, the answer is NO!

A receipt indicates that the goods and services are received in the daily business trade and represents the item’s ownership.

You can opt for the best online invoice app to generate quick invoices as a business owner.

How Are They Used?

Invoices have many underlying aspects besides just receiving the payment from the buyer. It also allows you to keep track of sales, manage product inventory, facilitate the delivery of the goods, etc. The top small business invoice app provides you with expense reports and insights and helps you project future revenues. Additionally, you can also get time tracking and recurring invoice features along with it. It helps you manage customer relationships by offering cutting-edge solutions.

On the other hand, customers use receipts to prove their payment against the invoice generated. This majorly helps in the situation wherein a buyer needs to return an item in the event of faulty goods. E-invoicing tools provide immaculate data analysis of your business. If used properly and at its optimum level, it gives you every small but crucial detail and insight of your business, and of course, you can have a real-time preview of your business performance. 

Also Read: What is the Difference Between a Receipt and an Invoice?


Moon Invoice, a simple and easy invoicing platform that can be accessed on any smartphone with any operating system, have a wide range of customers whose payment methods have been simplified by offering multiple payment options and also simultaneously catering to the numerous features related to invoicing, estimates, purchase order, expense tracker, time tracker, sync, print, payment notifications and many more. Let’s discuss the ‘Payment’ while keeping the general invoicing features in mind.

With Moon Invoice, your business will enjoy simplified payment with multiple options and avoid payment delays. Following are the payment features to adopt that will lead to ‘Upward Shift In Bill Pay Services’ and address the long-awaited need to reduce the use of paper checks to be compatible with fast-paced business momentum.

Additionally, Moon Invoice lets your business be on top of the competition with Instant Invoicing & Billing, Easy track of Payment & Notifications, Accurate Insights & Reporting Data. A few amazing add-ons with Moon Invoice are that you can add & “Manage Multiple Businesses,” “22+ Professional PDF Templates”, “Import/Export & Print Utility,” and data backup “iCloud sync & MoonSync support.”