Short answer. A proforma invoice is a preliminary bill that tells the buyer what they will pay for an order before the goods are supplied. A tax invoice is the formal GST document issued for an actual supply. Most traders send a proforma first so the buyer can approve and pay; check the rules for your own case with your CA.
What a proforma invoice is
A proforma invoice is a statement of what you will charge: items, quantities, rates, taxes, delivery terms and how to pay. It is sent before the goods move. Buyers use it to get internal approval, raise their own purchase order or release an advance payment.
It is a commercial document that helps both sides agree. It is not the same thing as the final tax invoice.
What a tax invoice is
A tax invoice is the document used for GST when a supply of goods or services is made. It carries the details the law asks for, such as the GSTIN, the invoice number, the tax split and the date. Buyers who claim input tax credit rely on it.
The exact rules, timing and format depend on your registration and your kind of supply. This guide gives the basics only. Please check with your CA before you decide how to bill.
Why traders send the proforma first
The usual flow is quote, then approval, then proforma, then payment or advance, then dispatch, then the final invoice. The proforma keeps everyone aligned. It shows the buyer the exact amount, it gives them something to attach to their approval, and it gives you a clear reference when the payment arrives.
It also reduces disputes. When the amount, the tax and the terms are written down before work starts, there is less to argue about later.
What a good proforma contains
Your business name and address, the client's details, a number and a date, each item with quantity and rate, the tax split, the total, delivery terms, how long the rates are valid, and payment instructions. A UPI QR for the exact balance makes paying easier for small and mid-size buyers.
How ResellerSuite helps
ResellerSuite raises proforma invoices numbered by financial year, such as PI/2026-27/0001, with the tax shown as CGST and SGST or IGST. Each carries a UPI QR for the balance due and your bank details, and the client can open it from a private link.
When money arrives you record the payment with its UTR, and the desk shows who owes what and for how long. Be clear on one point: ResellerSuite does not issue GST tax invoices today. That is listed as coming soon, so keep using your accounting software or your CA for the final invoice.
A simple flow you can follow
One way a trader's order often runs: the client asks for a quote; you send it; the client approves an option; you send a proforma invoice with the total and payment details; the client pays an advance or the full amount; you place the purchase order with your vendor; the goods are dispatched with a challan; and the final tax invoice is issued as your accounting process requires.
Each step has a record. When a client calls to ask why the amount is what it is, you open the order and see the quote, the proforma, the payments and the dispatches in one place.
Questions to take to your CA
Ask your CA when exactly you should issue the tax invoice for your kind of goods, how to treat advance payments, which details must appear on each document, how long to keep records, and how to number documents across the financial year. Your CA knows your registration and can answer for your case. This page cannot.
Mistakes that cause trouble
Calling a proforma a tax invoice in conversation, which confuses the buyer's accounts team. Sending a proforma with no validity date, then being held to old rates. Editing the amount after it was sent without issuing a revision. Forgetting to match each payment to the right document. Losing the thread between the proforma and the final invoice, so the same order is billed twice or not at all.
A system that numbers documents for you, keeps revisions and links payments to the order removes most of these slips. Your accounting software then takes over for the formal invoice.
Habits to keep
Number your documents in order. Write the validity date. Never change a sent proforma silently; issue a revision instead. Keep the payment reference with the order. And keep your CA in the loop when anything about tax treatment is unclear.
Read more on what the desk covers, or about credit limits and part dispatch.
Frequently asked questions
Is a proforma invoice a legal tax document?
No. It is a preliminary commercial document. The GST tax invoice is the formal document for a supply. Check your own case with your CA.
Can a buyer pay against a proforma invoice?
Yes, that is very common, particularly for advances and first orders.
Does ResellerSuite issue GST tax invoices?
Not yet. It issues proforma invoices today. GST tax invoices are marked coming soon.
Should a proforma have an expiry date?
It is good practice. Prices and stock change, so state how long the rates are valid.