{"id":2357,"date":"2026-03-24T09:56:21","date_gmt":"2026-03-24T09:56:21","guid":{"rendered":"https:\/\/www.info-tech.com.sg\/blog\/?p=2357"},"modified":"2026-05-07T09:25:29","modified_gmt":"2026-05-07T09:25:29","slug":"proforma-invoice-for-businesses","status":"publish","type":"post","link":"https:\/\/www.info-tech.com.sg\/blog\/proforma-invoice-for-businesses\/","title":{"rendered":"Proforma Invoice: What Is It and How\u00a0To\u00a0Prepare It\u00a0"},"content":{"rendered":"\n<div class=\"toc-card mt-3\">\n<div class=\"toc-header\">\n<figure><img decoding=\"async\" src=\"https:\/\/www.info-tech.com.sg\/blog\/wp-content\/uploads\/2026\/04\/tool-icon.png\"><\/figure><div class=\"icon-box\"><\/div>\n<h2 class=\"wp-block-heading\">In this article<\/h2>\n<\/div>\n<ul class=\"toc-list\">\n<li><a href=\"#section1\">1. What is a Proforma Invoice?<\/a><\/li>\n<li><a href=\"#section2\">2. What Should A Proforma Invoice Include?<\/a><\/li>\n<li><a href=\"#section3\">3. Why Is a Proforma Invoice Important?<\/a><\/li>\n<li><a href=\"#section4\">4. How to Prepare a Proforma Invoice?<\/a><\/li>\n<li><a href=\"#section5\">5. How\u00a0Proforma Invoice\u00a0Differs from Other Invoices?<\/a><\/li>\n<li><a href=\"#section6\">6. Conclusion\u00a0?<\/a><\/li>\n<li><a href=\"#section7\">7. Proforma Invoice FAQs<\/a><\/li>\n<\/ul>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"section1\"><strong>What is a Proforma Invoice<\/strong>?<\/h2>\n\n\n\n<p>A&nbsp;proforma&nbsp;invoice is an&nbsp;estimated&nbsp;bill&nbsp;issued&nbsp;by a seller&nbsp;to a buyer before&nbsp;a&nbsp;sale&nbsp;is&nbsp;finalised.&nbsp;It outlines the expected details of a transaction, including goods or services, pricing, and delivery terms.&nbsp;<\/p>\n\n\n\n<p><strong>It&nbsp;differs from a standard invoice because:&nbsp;<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>It is not a request for payment&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>It is not&nbsp;recognised&nbsp;as an accounting or tax document&nbsp;<\/li>\n<\/ul>\n\n\n\n<p>In simple terms, a this invoice is&nbsp;essentially a&nbsp;quotation presented in an invoice format.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"section2\"><strong>What Should A Proforma Invoice Include<\/strong>?<\/h2>\n\n\n\n<p>It&nbsp;must&nbsp;contain&nbsp;the&nbsp;key&nbsp;details of the&nbsp;proposed&nbsp;transaction, such as:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Seller and buyer information&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Date&nbsp;of issue&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Description of goods or services&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Quantity&nbsp;and unit price&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Estimated taxes or shipping charges&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Payment terms&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Delivery details&nbsp;<\/li>\n<\/ul>\n\n\n\n<p>Providing clear and complete information helps both parties align before confirming the transaction.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"section3\"><strong>Why Is a Proforma Invoice Important<\/strong>?<\/h2>\n\n\n\n<p>This&nbsp;invoice&nbsp;is important because it gives both the buyer and seller a clear understanding of the proposed transaction before&nbsp;it is&nbsp;finalised.&nbsp;&nbsp;It supports better planning, reduces misunderstandings, and ensures smoother execution.&nbsp;&nbsp;<\/p>\n\n\n\n<p><strong>Here\u2019s&nbsp;why it matters:&nbsp;<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Structures cost in advance<\/strong>:&nbsp;Display of&nbsp;estimated cost of&nbsp;goods or services, including taxes and shipping&nbsp;charges,&nbsp;will give&nbsp;the buyer an idea&nbsp;about the&nbsp;budget they have to&nbsp;allocate.&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Transaction details confirmation<\/strong>:&nbsp;Details such as&nbsp;item description, quantity, payment terms, delivery terms, and buyer-seller details&nbsp;can be checked and confirmed.&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Supports budgeting and approvals<\/strong>:&nbsp;Supports budgeting and approvals&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Useful for import and export processes<\/strong>:&nbsp;Used for custom&nbsp;documentation, import permits, and shipping arrangements.&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Transparency and trust<\/strong>:&nbsp;Clear documentation of terms&nbsp;between the seller and the buyer by laying out&nbsp;terms&nbsp;clearly beforehand.&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Reference for final invoice<\/strong>:&nbsp;After&nbsp;the confirmation&nbsp;of the order,&nbsp;final&nbsp;invoice is created based on the&nbsp;details in the proforma invoice.&nbsp;<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"section4\"><strong>How to Prepare a Proforma Invoice<\/strong>?<\/h2>\n\n\n\n<p>Creating this invoice is&nbsp;a simple process, but it is essential to ensure that all the&nbsp;information mentioned&nbsp;is&nbsp;accurate&nbsp;and complete to avoid confusion&nbsp;later on.&nbsp;<\/p>\n\n\n\n<ol start=\"1\" class=\"wp-block-list\">\n<li><strong>Add Seller and Buyer Details<\/strong>&nbsp;<\/li>\n<\/ol>\n\n\n\n<p>Include&nbsp;the business name, address, and contact&nbsp;details&nbsp;of both parties.&nbsp;<\/p>\n\n\n\n<ol start=\"2\" class=\"wp-block-list\">\n<li><strong>Include a Unique&nbsp;Reference&nbsp;Number and Date<\/strong>&nbsp;<\/li>\n<\/ol>\n\n\n\n<p>Assign a&nbsp;reference number&nbsp;and&nbsp;specify&nbsp;the issue&nbsp;date for&nbsp;tracking purposes.&nbsp;<\/p>\n\n\n\n<ol start=\"3\" class=\"wp-block-list\">\n<li><strong>Clearly Label It as \u201cProforma Invoice\u201d<\/strong>&nbsp;<\/li>\n<\/ol>\n\n\n\n<p>The document should be clearly labeled to avoid confusion&nbsp;with&nbsp;a&nbsp;tax&nbsp;invoice.&nbsp;<\/p>\n\n\n\n<ol start=\"4\" class=\"wp-block-list\">\n<li><strong>Describe Goods or Services<\/strong>&nbsp;<\/li>\n<\/ol>\n\n\n\n<p>Provide a clear&nbsp;and detailed description of the item or services&nbsp;<\/p>\n\n\n\n<ol start=\"5\" class=\"wp-block-list\">\n<li><strong>Mention Total Estimated Cost<\/strong>&nbsp;<\/li>\n<\/ol>\n\n\n\n<p>The total cost should include:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Subtotal&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Applicable taxes&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Shipping charges&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Total payable&nbsp;amount&nbsp;<\/li>\n<\/ul>\n\n\n\n<ol start=\"6\" class=\"wp-block-list\">\n<li><strong>Specify Payment Terms<\/strong>&nbsp;<\/li>\n<\/ol>\n\n\n\n<p>The terms and conditions&nbsp;regarding&nbsp;payment&nbsp;methods&nbsp;should be specified.&nbsp;<\/p>\n\n\n\n<ol start=\"7\" class=\"wp-block-list\">\n<li><strong>Add Delivery Details<\/strong>&nbsp;<\/li>\n<\/ol>\n\n\n\n<p>The delivery date, shipping details, etc., should be added.&nbsp;<\/p>\n\n\n\n<ol start=\"8\" class=\"wp-block-list\">\n<li><strong>Include Terms and Conditions<\/strong>&nbsp;<\/li>\n<\/ol>\n\n\n\n<p>Any specific terms should be added, such as the validity period of the invoice.&nbsp;<\/p>\n\n\n\n<ol start=\"9\" class=\"wp-block-list\">\n<li><strong>Add Authorized Signature (Optional)<\/strong>&nbsp;<\/li>\n<\/ol>\n\n\n\n<p>The document should be signed by an authorized person&nbsp;for&nbsp;formality but&nbsp;not always&nbsp;required.&nbsp;<\/p>\n\n\n\n<p><strong>Tip<\/strong>:&nbsp;Always double-check calculations and details before sending, to avoid&nbsp;errors, miscommunication, and&nbsp;delay in&nbsp;delivery&nbsp;of the order.&nbsp;<\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-large is-resized\"><img loading=\"lazy\" decoding=\"async\" width=\"943\" height=\"1024\" src=\"https:\/\/www.info-tech.com.sg\/blog\/wp-content\/uploads\/2026\/03\/Proforma-Invoice-at-a-Glance-943x1024.png\" alt=\"\" class=\"wp-image-2362\" style=\"aspect-ratio:0.9209084814493844;width:709px;height:auto\" srcset=\"https:\/\/www.info-tech.com.sg\/blog\/wp-content\/uploads\/2026\/03\/Proforma-Invoice-at-a-Glance-943x1024.png 943w, https:\/\/www.info-tech.com.sg\/blog\/wp-content\/uploads\/2026\/03\/Proforma-Invoice-at-a-Glance-276x300.png 276w, https:\/\/www.info-tech.com.sg\/blog\/wp-content\/uploads\/2026\/03\/Proforma-Invoice-at-a-Glance-768x834.png 768w, https:\/\/www.info-tech.com.sg\/blog\/wp-content\/uploads\/2026\/03\/Proforma-Invoice-at-a-Glance.png 1033w\" sizes=\"auto, (max-width: 943px) 100vw, 943px\" \/><figcaption class=\"wp-element-caption\">Proforma Invoice at a Glance<\/figcaption><\/figure>\n<\/div>\n\n\n<h2 class=\"wp-block-heading\" id=\"section5\"><strong>How\u00a0Proforma Invoice\u00a0Differs from Other Invoices<\/strong>?<\/h2>\n\n\n\n<p>&nbsp;This invoice is an estimate, while other invoices are official documents used for billing and accounting.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-table is-style-stripes\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Aspect<\/strong>&nbsp;<\/td><td><strong>Proforma Invoice<\/strong>&nbsp;<\/td><td><strong>Final Invoice \/ Commercial \/ Tax Invoice<\/strong>&nbsp;<\/td><\/tr><tr><td><strong>Purpose<\/strong>&nbsp;<\/td><td>Estimate or quotation&nbsp;<\/td><td>Completed&nbsp;sale&nbsp;<\/td><\/tr><tr><td><strong>Timing<\/strong>&nbsp;<\/td><td>Before the sale is confirmed&nbsp;<\/td><td>After goods\/services are delivered or confirmed&nbsp;<\/td><\/tr><tr><td><strong>Legal Status<\/strong>&nbsp;<\/td><td>Not legally binding (in most cases)&nbsp;<\/td><td>Legally recognized financial document&nbsp;<\/td><\/tr><tr><td><strong>Payment Demand<\/strong>&nbsp;<\/td><td>Not a demand for payment&nbsp;<\/td><td>Official payment request&nbsp;<\/td><\/tr><tr><td><strong>Tax Applicability<\/strong>&nbsp;<\/td><td>Not used for tax purposes&nbsp;<\/td><td>Used for&nbsp;GST\/tax reporting&nbsp;<\/td><\/tr><tr><td><strong>Content Nature<\/strong>&nbsp;<\/td><td>Estimated&nbsp;and provisional&nbsp;&nbsp;<\/td><td>Final and confirmed&nbsp;<\/td><\/tr><tr><td><strong>Use in Trade<\/strong>&nbsp;<\/td><td>Quotation, approvals, or customs reference&nbsp;<\/td><td>Billing, customs clearance, and payment&nbsp;<\/td><\/tr><tr><td><strong>Buyer\u2019s Role<\/strong>&nbsp;<\/td><td>Review and approve the purchase&nbsp;<\/td><td>Make payment&nbsp;<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"section6\"><strong>Conclusion&nbsp;<\/strong><\/h2>\n\n\n\n<p>In today\u2019s digital business scenario, preparing and managing proforma invoices manually&nbsp;consumes more&nbsp;time and may involve errors. This is where&nbsp;a&nbsp;<a href=\"https:\/\/www.info-tech.com.sg\/e-invoicing-software\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>E-invoicing Software<\/strong><\/a>&nbsp;plays&nbsp;a vital role. With the help of automated invoice creation, precise tax calculations, and seamless&nbsp;integration with accounting systems, businesses can easily create and convert them into final invoices when&nbsp;required.&nbsp;<\/p>\n\n\n\n<p class=\"has-background\" style=\"background:linear-gradient(135deg,rgb(252,185,0) 100%,rgb(255,105,0) 100%)\"><strong>Want to make your business invoicing smoother and more efficient?&nbsp;<a href=\"https:\/\/www.info-tech.com.sg\/contact-us\" target=\"_blank\" rel=\"noreferrer noopener\">Contact us<\/a>&nbsp;now!&nbsp;<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"section7\"><strong>Proforma Invoice FAQs<\/strong><\/h2>\n\n\n<div class=\"container\">\n<div class=\"mi-faq\">\n<div id=\"accordionExample\" class=\"accordion\">\n<div class=\"card\">\n<div id=\"headingOne\" class=\"card-head\">\n<div class=\"acc-arrow\" data-toggle=\"collapse\" data-target=\"#collapseOne\" aria-expanded=\"true\" aria-controls=\"collapseOne\">\n<h4 class=\"Positionheader\">What is the difference between an invoice and a proforma invoice?<\/h4>\n<\/div>\n<\/div>\n<div id=\"collapseOne\" class=\"collapse show\" aria-labelledby=\"headingOne\" data-parent=\"#accordionExample\">\n<div class=\"card-body\">\n<p>The main difference is that an invoice is an official request for payment, while the latter is a preliminary document sent before the sale is finalized.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"card\">\n<div id=\"headingtwo\" class=\"card-head\">\n<div class=\"collapsed acc-arrow\" data-toggle=\"collapse\" data-target=\"#collapsetwo\" aria-expanded=\"false\" aria-controls=\"collapsetwo\">\n<h4 class=\"Positionheader\">Is a proforma invoice a proper invoice?<\/h4>\n<\/div>\n<\/div>\n<div id=\"collapsetwo\" class=\"collapse\" aria-labelledby=\"headingtwo\" data-parent=\"#accordionExample\">\n<div class=\"card-body\">\n<p>No, it is not a proper invoice in official accounting, but a quotation in invoice format.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"card\">\n<div id=\"headingthree\" class=\"card-head\">\n<div class=\"collapsed acc-arrow\" data-toggle=\"collapse\" data-target=\"#collapsethree\" aria-expanded=\"false\" aria-controls=\"collapsethree\">\n<h4 class=\"Positionheader\">Who issues a proforma invoice?<\/h4>\n<\/div>\n<\/div>\n<div id=\"collapsethree\" class=\"collapse\" aria-labelledby=\"headingthree\" data-parent=\"#accordionExample\">\n<div class=\"card-body\">\n<p>It is issued by the seller or service provider to the buyer before the actual sale is completed.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"card\">\n<div id=\"headingfour\" class=\"card-head\">\n<div class=\"collapsed acc-arrow\" data-toggle=\"collapse\" data-target=\"#collapsefour\" aria-expanded=\"false\" aria-controls=\"collapsefour\">\n<h4 class=\"Positionheader\">Why would someone want a proforma invoice?<\/h4>\n<\/div>\n<\/div>\n<div id=\"collapsefour\" class=\"collapse\" aria-labelledby=\"headingfour\" data-parent=\"#accordionExample\">\n<div class=\"card-body\">\n<p>It is because this invoice helps them review the expected cost and terms of a transaction before making a final commitment.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n\n\n<script type=\"application\/ld+json\">\n{\n  \"@context\": \"https:\/\/schema.org\",\n  \"@type\": \"FAQPage\",\n  \"mainEntity\": [{\n    \"@type\": \"Question\",\n    \"name\": \"What is the difference between an invoice and a proforma invoice?\",\n    \"acceptedAnswer\": {\n      \"@type\": \"Answer\",\n      \"text\": \"The main difference is that an invoice is an official request for payment, while the latter is a preliminary document sent before the sale is finalized.\"\n    }\n  },{\n    \"@type\": \"Question\",\n    \"name\": \"Is a proforma invoice a proper invoice?\",\n    \"acceptedAnswer\": {\n      \"@type\": \"Answer\",\n      \"text\": \"No, it is not a proper invoice in official accounting, but a quotation in invoice format.\"\n    }\n  },{\n    \"@type\": \"Question\",\n    \"name\": \"Who issues a proforma invoice?\",\n    \"acceptedAnswer\": {\n      \"@type\": \"Answer\",\n      \"text\": \"It is issued by the seller or service provider to the buyer before the actual sale is completed.\"\n    }\n  },{\n    \"@type\": \"Question\",\n    \"name\": \"Why would someone want a proforma invoice?\",\n    \"acceptedAnswer\": {\n      \"@type\": \"Answer\",\n      \"text\": \"It is because this invoice helps them review the expected cost and terms of a transaction before making a final commitment.\"\n    }\n  }]\n}\n<\/script>\n","protected":false},"excerpt":{"rendered":"<p>In this article 1. What is a Proforma Invoice? 2. What Should A[&#8230;]<\/p>\n","protected":false},"author":11,"featured_media":2361,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[211],"tags":[243,272,282],"industry":[111],"ppma_author":[265],"class_list":["post-2357","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-e-invoicing","tag-e-invoicing-software","tag-proforma-invoice","industry-financial-accounting"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v24.9 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>What is\u00a0Proforma Invoice and Why It Matters\u00a0<\/title>\n<meta name=\"description\" content=\"Get to know the use of proforma invoice in businesses, and the details it should include for business transactions.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link 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