Quotation vs Proforma Invoice vs Tax Invoice: What's the Difference?
Three documents, three purposes. Sending the wrong one can delay payment or create GST liability you did not intend.
Quotation
A pre-sale offer stating price, validity and terms. It has no accounting effect and no GST liability. Use it to win the order.
Proforma invoice
A preliminary bill sent before goods or services are delivered — often for advance payment or import documentation. It is not a tax invoice; ITC cannot be claimed on it.
Tax invoice
The legal document under Rule 46 that triggers time of supply, GST liability and the buyer's ITC. Issue it at delivery or completion.
Common mistake
Numbering proformas in the same series as tax invoices. Keep separate series so GSTR-1 stays clean.
Workflow tip
In SmartGST create a quotation, let the client accept it online, then click Convert to Invoice — the tax invoice inherits every line item and gets its own sequential number.
Try it on your next invoice
SmartGST Invoices automates GST calculation, HSN codes, reminders and GSTR reports. Free to start.
Create a free accountKeywords: proforma invoice vs tax invoice · quotation vs invoice. This article is general information, not professional tax advice.
