If you run a business or offer a service, you’ve likely used both invoices and receipts. But despite how often the two terms are used interchangeably, they’re not the same thing.
Knowing the difference between an invoice and a receipt is important. It helps you follow the rules and keeps your records organized. Plus, it allows you to communicate clearly with customers. In this guide, we’ll break down:
- Whether an invoice counts as a receipt
- The key differences between them
- When to issue each one
- How they fit into your accounting process
- How to write them correctly
How to manage them both more efficiently
Firstly, is an invoice a receipt?
No. While both are related to a sale, an invoice is not a receipt. An invoice is a request for payment and is issued before payment is made. A receipt is a confirmation of payment and is issued after the payment is received.
Think of it this way:
- An invoice says: “Here’s what you owe.”
- A receipt says: “Here’s what you paid.”
If you’re new to invoicing or want a full breakdown, our Everything You Need to Know Guide covers all the basics. Explore everything from structure and essentials to common use cases.
Key Differences Between Invoices and Receipts
Feature | Invoice | Receipt |
Purpose | Requests payment | Confirms payment |
Timing | Issued before payment | Issued after payment |
Contains due date? | Yes | No |
Contains payment method? | Usually not | Yes |
Legally required? | In some cases | Often, depending on region |
Accounting use | Records accounts receivable | Confirms revenue received |
Both documents are important — but they serve different functions for both businesses and customers.
When They’re Issued
Invoices
Invoices are issued before payment. This could be:
- Immediately after delivering a product or service
- On a set billing cycle (e.g. monthly)
- After a quote or proforma invoice is approved
They typically include:
- Itemised list of goods and services
- Total amount due
- Due date
- Payment terms
Learn more in our guide to writing an invoice.
Receipts
Receipts are issued after payment is received.
They act as proof that the customer has paid and help both parties track completed transactions. This is especially useful for:
- Refunds or returns
- Customer service queries
- Tax and expense records
For a full breakdown, check out our guide on: How to Write a Receipt of Payment.
What Payment Information Do They Contain?
Invoices and receipts both include payment details, but not in the same way.
Invoices often include:
- Amount owed
- Accepted payment methods (e.g. bank transfer, credit cards, PayPal)
- Terms (e.g. Net 30, Net 15)
Receipts include:
- Amount paid
- Payment method used
- Transaction or reference number
- Date of payment
If your customer pays with a credit card or direct deposit, this information shows on the receipt, not the invoice.
For more on collecting electronic payments, read: What Information is Needed for Direct Deposit Setup?.
How They’re Used in Accounting
Invoices
Invoices are recorded as accounts receivable — money owed to your business. Until the payment is made, the amount remains outstanding. This helps track:
- Expected income
- Outstanding balances
- Cash flow projections
They also support revenue tracking and can be used for tax filing.
Receipts
Receipts confirm that revenue has been received, and are recorded as income in your accounting software. They’re often required for:
- Tax audits
- Financial reporting
- Customer records
Both documents play key roles in your bookkeeping workflow — from sale to settlement.
Using Invoices and Receipts Together
Most businesses will need to issue both documents as part of a normal transaction process:
- Issue invoice → Client receives payment request
- Receive payment → Update accounting records
- Issue receipt → Confirm payment completion
Using them together gives you a clear path from offer to payment. This ensures you are protected legally, financially, and in customer service.
Want to understand related terms? Check out:
Can I Issue an Invoice After Payment?
In general, no.
An invoice is meant to be issued before payment — as a request for money owed. If you issue it after being paid, it no longer serves its intended purpose.
If payment has already been received, you should issue a receipt instead.
In some cases, you can issue a paid invoice. This document is marked “Paid.” However, it is not the same as a receipt. It may not meet legal or tax requirements based on where you are.
How to Write an Invoice
To write a professional invoice, include:
- Business name and contact information
- Client information
- Unique invoice number
- Issue date and due date
- Itemised list of products/services
- Subtotal, tax, and total due
- Payment options, instructions or terms
Need help? Use our step-by-step guide: How to Write an Invoice (Includes Template and Examples)
How to Write a Receipt
To create a receipt that meets most business needs, include:
- Your business name and logo (if applicable)
- Date of payment
- Amount paid
- What the payment was for (product or service)
- Payment method (e.g. credit card, cash, bank transfer)
- Receipt or transaction number
- Business signature or stamp (optional)
Receipts don’t include due dates or terms, but they should clearly show that the payment has been received in full.
Simplify How You Handle Your Documents
Managing sales documents manually takes time and can often open the door to missed payments or messy records. Manage receipts and invoicing with QuickBooks and Invoice Fly’s Invoice Maker. Tools like these simplify the process by:
- Creating and sending professional invoices in seconds
- Tracking payments in real time
- Automatically generating receipts
- Keeping everything stored in one place for easy reporting
With the right system in place, you can reduce admin time, avoid errors, and offer better service to your customers.
FAQs about Invoices vs. Receipts
An invoice is a request for payment, issued before the customer pays. A receipt is issued after the customer receives the product or service and confirms that the payment has been made. Both documents are essential for small businesses to track financial transactions and stay compliant.
No. An invoice alone is not sufficient proof of payment. Business owners should always provide a receipt — especially for tax purposes and to maintain proper bank account records.
In many regions, yes. Receipts are often legally required for online payments, refunds, or claims, and serve as official documentation for accounting and customer service.
Yes. Sending both helps maintain accurate records and supports a clear customer experience. The invoice notifies the customer of what’s due, and the receipt confirms that the payment was completed.
Yes. Many small business owners rely on automation to manage their finances more efficiently.
Software like Invoice Fly can generate invoices, issue receipts, and track customer payments in real time — freeing up time for business growth.
