GST Basics
Proforma Invoice vs Tax Invoice in India: Key Differences
A proforma is a quote; a tax invoice is a legal demand. Confusing them can cause compliance issues — here's exactly when to use each.
5 Feb 20266 min read
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Free Proforma Invoice Generator
Send a professional pre-sale estimate with GST indication and a valid-until date. Convert to a tax invoice in one click when the buyer confirms.
- CBIC Rule 46 compliant
- PDF made in your browser
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Overview
What is a Proforma Invoice?
A proforma invoice is a pre-sale document — a formal quotation or estimate — sent to a prospective buyer before the supply takes place. It looks like a tax invoice and shows the expected line items, taxes and total, but it is not a tax document.
Because no supply has happened, a proforma invoice does not create any GST liability and must not be reported in GSTR-1 or GSTR-3B. It cannot be used by the buyer to claim Input Tax Credit. To make this clear, every proforma must carry the words "PROFORMA INVOICE" and a non-tax declaration.
Proformas typically carry a "valid until" date and are used in export deals (for advance bank remittances or LC opening), capital-goods quotes, custom orders, and any B2B negotiation where the buyer needs a formal document to release a PO or budget.
When to issue a Proforma Invoice
- You are sending a formal quote before the buyer commits to purchase.
- The buyer needs a document to open a Letter of Credit or get an advance remittance.
- You want to lock in pricing for a defined window (the validity date).
- Cross-border negotiations where customs needs an estimated value.
- Anywhere a 'quote' or 'estimate' is expected but in invoice format.
Fields
Key fields on a Proforma Invoice
- "PROFORMA INVOICE" heading
- Mandatory — distinguishes the document from a tax invoice.
- Proforma number
- Your own running series; we default to a PRO- prefix.
- Date of issue
- When the quote was generated.
- Valid until
- Pricing validity expiry — pricing may revise after this date.
- Buyer details
- GSTIN optional at this stage; can be added when converting to tax invoice.
- Line items with estimated GST
- Rates shown are indicative — actual tax is locked at supply.
- Non-tax declaration
- "NOT A TAX INVOICE — this is a proforma estimate only" is printed automatically.
How it works
Generate in 3 simple steps
- 1
Fill in details
Add your business info, buyer details, items, and a valid-until date.
- 2
Preview live
See the proforma render in real time — GST is shown as indicative.
- 3
Download or convert
Download PDF to email the buyer. Convert it into a tax invoice once they confirm.
What freelancers say
Switched from Zoho last month — haven't looked back. The CGST/SGST split is automatic, and the one-click GSTR-1 export saves my CA hours at the end of every month.
Had a cross-state client situation I was calculating wrong for months. ZapInvoice just switches to IGST automatically — no more manual guessing, no more wrong invoices.
I bill 15+ clients a month and used to chase every single one. Now ZapInvoice auto-reminds them on day 3, 7 and 14 — most pay before I even notice. Pro pays for itself.
FAQ
Frequently asked questions
Everything you need to know about proforma invoice generation.
Is a proforma invoice the same as a quotation?
Practically yes — but a proforma is formatted like an invoice (line items, taxes, totals) while a quotation can be plain text. Buyers and banks often specifically ask for a proforma when they need an invoice-style document pre-sale.
Does GST apply on a proforma invoice?
No. GST applies only at the time of supply. A proforma shows GST as an estimate so the buyer can budget — but you do not owe any tax on it and you must not file it in GSTR-1.
Can a buyer claim ITC on a proforma invoice?
No. Input Tax Credit can only be claimed on a valid tax invoice, debit note, or other prescribed document. A proforma is not a tax document.
Do I need to maintain proforma numbering separately?
Yes — it is good practice to keep a separate proforma series (PRO-) so it never gets confused with your tax invoice series (INV-). Our builder does this by default.
How long should a proforma be valid?
Typically 7 to 30 days. Set whatever you can honor — after the validity date you can issue a fresh proforma with revised pricing.
Can a proforma be converted into a tax invoice?
Yes. Once the buyer accepts, you issue a fresh tax invoice (with a tax-invoice number from your INV series). Our builder has a one-click convert flow.
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Guides
Read before you issue one
GST Basics
How to Create a GST Invoice in India (2026 Guide)
Everything you need to create a legally compliant GST invoice — mandatory fields, tax calculation, and common mistakes to avoid.
15 Jan 20269 min read
Freelancers
GST Invoice for Freelancers in India: Complete 2026 Guide
Everything Indian freelancers need to know about GST invoicing — registration threshold, SAC codes, billing format, and how to invoice foreign clients.
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