Difference between Receipt and Invoice

Key Difference: An invoice is basically a bill that lists the goods or services rendered and the cost of those goods or services. A receipt is an acknowledgement that the customer has paid his bill either in full or in part.

 Whenever you buy something, chances are you have either received a receipt or an invoice for it. However, what exactly are they and what is the actual difference between them?

When some goods or services have been purchased, a list is usually created by the seller. This list names all the products, goods and/or services that have been purchased by the customer and the total amount that the customer has to pay for the services. This list is also known as a bill. Invoice is nothing more than another name for a bill. Whereas, the term bill is used in everyday context, the term invoice is used specifically in the industry to refer to goods. However, an invoice is a list of goods sold and the total amount that the customer has to pay, which means that it is identical to a bill.

Once, the customer is provided with an invoice, it is the customer’s duty to pay the amount on the invoice by the due date. Once the customer pays the seller, the seller will issue a receipt to the customer for the amount paid. A receipt is nothing more than a piece of paper that proves that the customer has paid the said amount. It also records the sale of goods or provision of a service. In some cases, a receipt may also act as a proof of ownership, as the customer can show it to prove that he has paid for the said goods.

In most modern and low scale businesses, including shops, cafes, etc., the receipt and invoice are merged into one. The ‘bill’ lists the goods purchased, their rate, and the total amount to be paid. After the payment is made, the bill may or may not be marked with a ‘PAID’ to indicate that the customer has paid the outstanding bill.

Comparison between Receipt and Invoice:

 

Receipt

Invoice

Definition (Merriam-Webster)

A piece of paper on which the things that you buy or the services that you pay for are listed with the total amount paid and the prices for each

A document that shows a list of goods or services and the prices to be paid for them

Description

A receipt is an acknowledgement that the customer has paid his bill either in full or in part. The receipt with list the amount paid, and if paid in part, it will also list the amount due and the date it is due by.

An invoice is basically a bill that lists the goods or services rendered and the cost of those goods or services. It is then presented to the customer to let them know how much they owe and by when they are expected to pay.

Purpose

To acknowledge that the customer has paid a certain amount.

To acknowledge that the customer has to pay a certain amount for goods and services rendered.

When is it given

After the goods have been received by the customer and the customer has made the payment.

After the goods have been received by the customer.

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