Invoice vs receipt: what is the difference?
An invoice asks for payment, a receipt confirms it. Learn when to send each one, what they contain and why you often need both.
People often use the words "invoice" and "receipt" as if they meant the same thing. They do not. An invoice is a request for payment. A receipt is proof that payment was made. Most businesses need both, at different moments of the same sale.
The short answer
| Invoice | Receipt | |
|---|---|---|
| Purpose | Asks the customer to pay | Confirms the customer has paid |
| When | Before payment, after delivery | After payment |
| Shows | Amount due, due date, payment details | Amount paid, payment date, payment method |
| Typical label | "Balance due" | "Paid" |
When to send an invoice
Send an invoice when you have delivered goods or completed work and the customer pays later. It sets the amount, the deadline and how to pay. For businesses, the invoice is also the document their accountant needs to record the expense and, in many countries, to recover VAT.
When to give a receipt
Give a receipt as soon as you receive money. Shops hand one over at the till. Freelancers and service businesses send one after a bank transfer, a cash payment or a payment by card. A receipt protects both sides: the customer can prove they paid, and you can match the payment in your books.
A receipt usually shows:
- The receipt number and date of payment.
- Who paid and who received the money.
- What the payment was for, often with a reference to the invoice number.
- The amount and the payment method, such as cash, card or bank transfer.
- A "Paid" mention or stamp, and a signature when payment was made in cash.
Do you need both?
In business-to-business sales, yes in most cases: the invoice first, then a receipt or a "Paid" invoice once the transfer arrives. In shops and for small cash sales, a single receipt is often enough. Rent is a special case: tenants frequently need a rent receipt for each period to claim allowances or prove their address.
From invoice to receipt in one click
Confirm that a payment was received, marked as paid.
If you created the invoice here, open it and choose "Convert to" then "Receipt". The customer, the items and the invoice reference are copied for you. Read how to write an invoice if you are starting from scratch.