Key takeaways
- A proforma invoice is a quotation in invoice form, not a real invoice.
- It does not record a VAT liability and cannot be used to reclaim input VAT.
- A proforma is useful for deposits, approvals, long deliveries and trade terms.
- It must be labelled clearly as a proforma, not passed off as a VAT invoice.
- Whatever you invoiced by proforma should appear on the final invoice when the job is complete.
What a proforma invoice is
A proforma invoice is a quotation dressed up in the layout of an invoice. It shows the client exactly what you will supply and what it will cost, before the actual work or delivery happens and before the real invoice is issued. It is a promise of the final invoice, not the invoice itself.
Its two defining features are that it is not a VAT document — it does not record a tax point or create a VAT liability, so it cannot be used to reclaim input VAT — and that it must be clearly labelled as a proforma, so nobody mistakes it for the real thing.
When a proforma is the right tool
- Deposits and confirmation — send a proforma so the client can approve the figures (and sometimes pay a deposit) before the work starts.
- Long or staged jobs — show the full cost up front with a proforma, then invoice by milestones or at the end.
- Trade and large orders — where a purchase order must be matched, a proforma gives the client something to attach it to.
- Delivery of goods — for some trades a proforma travels with the goods; the final invoice is issued on the VAT point.
For a freelance or trade client, the proforma is also a small commitment device: an approved proforma is the moment the scope and the price stop being a debate.
What a proforma is not
The single most important point is what a proforma isn’t. It is not a VAT invoice, so it must not be used by the client to reclaim input VAT, and it must not create your VAT records. It is also not a demand for payment — unless you added a deposit line and it is accepted, the proforma itself does not require payment. And while it looks like an invoice, passing a proforma off as a final invoice to speed up a VAT reclaim or a payment is exactly where businesses get into trouble.
How the sequence works
Send the proforma first
Agreed scope, agreed price, clearly labelled PROFORMA INVOICE. The client approves it, and for larger jobs may pay a deposit against it.
Do the work (or ship the goods)
The supply happens, and nothing is charged yet — the proforma is still not an invoice. Extra items agreed along the way get added to the final bill.
Issue the real invoice
The final invoice replaces the proforma. It carries the same or updated figures, your references, and a date that sets your VAT point. The proforma’s job is done the moment it has a final bill to lead to.
When you convert the proforma to a final invoice with our sole trader invoice template or a VAT invoice template, keep the reference from the proforma on the invoice so the client can match the two documents.
Proformas for international sales
In international trade the proforma invoice is a standard customs and banking document. It gives the buyer and the freight forwarder the description, value and terms of the goods before shipment, and can be used to open letters of credit or arrange payment terms. It is still not the commercial invoice — but for exports it is often the document that keeps the deal moving.
Turn the proforma into the real thing
When the job is done, convert the agreed figures into a proper invoice — free, no sign-up.
Frequently asked questions
What is a proforma invoice?
A quotation laid out like an invoice, sent before the real invoice to show exactly what will be supplied and what it will cost. It is not a VAT document and must be clearly labelled as a proforma.
Is a proforma invoice a real invoice?
No. It is a formal quotation. It does not record a VAT point, does not create a VAT liability, and cannot be used to reclaim input VAT. The real invoice comes after the work.
When should I use a proforma invoice?
For deposits and client approval before work starts, for long or staged jobs where the full cost is agreed up front, and for trade or international sales where a document must accompany the goods or order.
Can I get paid on a proforma invoice?
Yes, in some arrangements — for example a deposit. But the proforma itself is not a demand for payment. What usually happens is the client approves or partly pays against it, and the final invoice settles the balance.
Is a proforma invoice the same as a quotation or estimate?
Similar, but with more detail. A proforma lays out the full itemised cost in invoice form, so the client can approve it and match it to a purchase order or payment, whereas an estimate or quote is typically less formal.
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General guidance only — not legal, tax or accounting advice. Rules and rates can change; check HMRC's current guidance for the latest. Last reviewed 8 October 2026.