Proforma invoice today. Tax invoice in one click.
Raise a proforma invoice in Books by finzko with the customer's GSTIN, line items, GST split by place of supply and totals exactly as the final invoice will show them. Send it by email; when the order is confirmed, convert it to a Tax Invoice in one click. The invoice posts to your books on its own.
| Item | Amount |
|---|---|
| Brand design retainer — Oct | ₹ 60,000 |
| Packaging artwork | ₹ 15,000 |
| Taxable value | ₹ 75,000 |
| IGST @ 18% | ₹ 13,500 |
| Total | ₹ 88,500 |
What is a proforma invoice?
A proforma invoice is a preliminary bill sent to a buyer before a sale is completed. It sets out what the seller will supply, at what price and with what tax, so the buyer can confirm the order, arrange payment or obtain an internal approval. It looks like an invoice and is laid out like one, but it is not a demand for payment for a supply already made: it is a commitment to supply on the stated terms, usually for a stated validity period.
Indian businesses use proforma invoices in a few familiar situations: to request an advance before goods are dispatched or work begins; in exports, where the buyer's bank needs a proforma to open a letter of credit or remit payment; when a customer needs a document to raise a purchase order or get a budget approved; and as a quotation that shows the GST the customer will actually pay, which a plain quote often leaves out.
There is no prescribed format, because a proforma invoice is not a GST document. In practice it carries everything the final tax invoice will: seller and buyer details with GSTINs, a number and date, validity, the description of goods or services with HSN or SAC, quantities and rates, taxable value, the GST rate and amount split as IGST or CGST+SGST by place of supply, the total, payment terms and bank details — under a clear “Proforma Invoice” heading so it is not mistaken for a tax invoice.
The point to be clear about: a proforma invoice is not a tax invoice under Section 31 of the CGST Act. Issuing one creates no GST liability, it is not reported in GSTR-1, no e-invoice (IRN) can be generated against it, the buyer cannot claim input tax credit on it, and it creates no receivable in the books. Tax is charged and the sale is recorded when the tax invoice is issued — which is why Books keeps the proforma outside the ledger until you convert it.
Proforma invoice vs tax invoice vs estimate
| Proforma invoice | Tax invoice | Estimate / quotation | |
|---|---|---|---|
| Purpose | A commitment to supply on stated terms, with the tax shown — used to request an advance, open an LC or get an order approved | The legal demand for payment for a supply that has been made; the GST document for the sale | A price offer for the customer to consider, before terms are settled |
| Issued | Before the supply, once the terms are agreed | At or after the supply — for goods, on or before removal or delivery; for services, within 30 days of the supply | Before the supply, while the terms are still being discussed |
| GST liability | None — the tax is shown, not charged | Yes, in the month of issue | None |
| Reported in GSTR-1 | No | Yes | No |
| e-Invoice / IRN | No — an IRN is generated only against a tax invoice, credit note or debit note | Yes, where e-invoicing applies to you | No |
| Numbering | Its own series, for example PI-2026-0031 | A consecutive, unique series for the financial year, as Rule 46 requires | Its own series |
| Can it be revised? | Freely — issue a fresh proforma | Not by editing — a credit note or debit note adjusts it | Freely |
| Becomes a receivable? | No — nothing is owed yet | Yes — it posts to the customer's ledger | No |
| In Books | An Estimate whose heading is set to “Proforma Invoice” | A Tax Invoice — converted from the proforma or raised directly | An Estimate whose heading is set to “Estimate” or “Quotation” |
One proforma. Then the invoice, and its journal.
In Books a proforma invoice is an Estimate with its heading set to “Proforma Invoice”. It carries the same customer, lines and GST the Tax Invoice will, so converting it is one click, not a re-key.
- 1Create an estimate headed “Proforma Invoice”Pick the customer, add the lines. IGST or CGST+SGST is applied from the place of supply, exactly as the final invoice will. You pick the printed heading on each estimate (with a company default), so proformas print as “Proforma Invoice” and quotes as “Quotation”. It takes the next number in its own series.
- 2Send it by emailEmail it from the app with the PDF attached, with the validity and payment terms on it. Nothing posts to the ledger: a proforma is a pre-sale document, not an accounting entry.
- 3Customer confirms, or pays an advanceIf the customer pays an advance against the proforma, record it as an advance receipt against the customer, so it is already in the books when the invoice follows.
- 4Convert to a Tax InvoiceOne click turns the proforma into a Tax Invoice — or into a sales order if you dispatch later. The invoice posts the receivable, sales and output GST on its own; generate the IRN from it if e-invoicing applies to you.
| Item | Amount |
|---|---|
| Brand design retainer — Oct | ₹ 60,000 |
| Packaging artwork | ₹ 15,000 |
| Taxable value | ₹ 75,000 |
| IGST @ 18% | ₹ 13,500 |
| Total | ₹ 88,500 |
| Account | Dr | Cr |
|---|---|---|
| Meera Foods LLP | ₹ 88,500 | |
| Sales | ₹ 75,000 | |
| Output IGST @ 18% | ₹ 13,500 | |
| Total | ₹ 88,500 | ₹ 88,500 |
After conversion: PI-2026-0031 became INV-2026-0147, and the receivable, sales and output IGST posted themselves. The proforma never touched the ledger.
What a proforma invoice should contain.
No format is prescribed, so follow the tax invoice: everything the final invoice will carry, plus the validity and a note that this is not one. Books prints all of it from the estimate.
Proforma invoices, answered.
What is a proforma invoice?
A proforma invoice is a preliminary bill sent before a sale is completed. It sets out what the seller will supply, at what price and with what tax, so the buyer can confirm the order, arrange payment or obtain approval. It is laid out like an invoice but it is not a demand for payment for a supply already made, and under GST it is not a tax invoice.
Is a proforma invoice legally binding?
Not as an invoice. It does not create a debt, a receivable or a tax liability. It is an offer on stated terms for a stated period; once the buyer accepts it — by confirming the order or paying the advance it asks for — a contract on those terms can exist, and the seller is expected to supply at that price. The binding document for payment and GST is the tax invoice that follows.
Is GST charged on a proforma invoice, and does it go in GSTR-1?
GST is shown on a proforma invoice so the buyer knows the amount they will pay, but it is not charged by it. No output tax liability arises when a proforma is issued, it is not reported in GSTR-1, and the buyer cannot claim input tax credit on it. Tax is charged, and the sale is recorded, when the tax invoice is issued.
Can I generate an e-invoice (IRN) for a proforma invoice?
No. The e-invoice system generates an IRN only for tax invoices, credit notes and debit notes. In Books, you convert the proforma to a Tax Invoice and generate the IRN with its signed QR from the invoice, if e-invoicing applies to you.
What is the difference between a proforma invoice and a quotation?
A quotation is a price offer made while the terms are still open. A proforma invoice is issued once the terms are settled, in the form of the invoice to come, with the tax worked out, usually to request an advance or to give the buyer a document for approval, a purchase order or a letter of credit. In Books both are Estimates; you pick the printed heading on each one, with a company default.
How do I convert a proforma invoice to a tax invoice in Books?
Open the proforma and choose Convert. Books creates a Tax Invoice with the same customer, lines and GST, in your invoice numbering series, and posts the receivable, sales and output GST as one balanced journal. You can convert to a sales order instead if you dispatch later. The proforma stays on file, linked to the invoice.
Can I take an advance payment against a proforma invoice?
Yes — requesting an advance is the most common reason to issue one. Record the money received as an advance receipt against the customer in Books, so it is already in the books when the invoice follows. On the tax side, no GST is payable on an advance received for goods (Notification 66/2017-Central Tax), but GST on an advance for services is payable in the period you receive it, and the advance should be documented with a receipt voucher. Your CA can confirm how this applies to you.
Is there a prescribed proforma invoice format or number series?
No. GST law prescribes the contents of a tax invoice, not of a proforma, because a proforma is not a GST document. In practice it carries what the tax invoice will — seller and buyer details with GSTINs, a number and date, validity, description with HSN or SAC, quantities, rates, taxable value, the GST split by place of supply, the total, payment terms and bank details — under a clear “Proforma Invoice” heading. In Books it takes the next number in its own series, with your prefix and format.
A supplier sent me a proforma invoice. Is it a bill?
No, and Books treats it that way. When a supplier's proforma reaches Finzi by email, WhatsApp or upload, it is recognised as a proforma and is not posted as a purchase bill, so no payable and no input credit are recorded on it. The bill is recorded when the supplier's tax invoice arrives.
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