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What is an invoice and what is it for

Having decided to follow the complex path of international trade, any businessman and merchant must be well versed in export-import operations. Including a clear understanding of what an invoice is, what its functions are, and how to fill it out correctly. We will talk about this in the article. An invoice is the main trade document that accompanies any cargo sent abroad. It contains detailed information about the transaction.
Who draws up the document

The invoice is issued by the sender, any employee of the enterprise or firm who has the exclusive right to send goods and materials abroad, as well as the right to execute and sign the accompanying papers. As a rule, invoices are issued in English, which is the main language in world trade. That is why the documents should be filled in English.

An invoice for customs is issued at the stage of shipment of goods with further transfer to a partner abroad.

What is an invoice for?

The procedure of customs clearance of goods implies the availability of a wide package of documents, the most important of which is the invoice. The document confirms the fact of shipment of material values and the recipient’s obligation to pay for the cargo, in accordance with clearly spelled out agreements (except for situations with prepayment). The invoice also fixes the amount to be paid to the buyer for goods or services, the number of units of goods, details of the parties to the transaction, etc.

A type of invoice is a proforma invoice, the data on the delivery of goods in which are of an intermediate nature, that is, during the transaction may still change, for example, the cost of the cargo, or the articles of specific models of goods.

How to fill in the invoice correctly

Correct filling of the customs invoice is the most important moment for the success of any foreign economic transaction. It not only confirms the fact of sending trade and material values, but also facilitates delivery on time. Any mistakes in filling in the document may cause the delay of the consignment at customs, hence the deterioration of partnership relations between the parties to the transaction. Clear criteria on how to fill in the invoice form are not provided by the legislation of Ukraine. In any case, a correctly drawn up document consists of the following elements:

  • invoice number and date of issue;
  • date of completion of delivery of goods or services;
  • name, addresses of the parties to the trade transaction;
  • details for payment of the foreign economic transaction;
  • terms of delivery, according to INCOTERMS 2020;
  • name and description of the goods (how many units of goods, sizes, color);
  • net price, tax rate, gross value;
  • total amount to be paid together with tax, expressed in figures and words.

The commercial invoice must be drawn up in four copies (original + 3 copies), either by hand or in printed form, certified by the sender’s signature. It is allowed to fill in the invoice both on the sender’s letterhead and on a simple A4 sheet.

Each of the four documents is used for its intended purpose: one is enclosed in the parcel, the second – in the provided pocket together with the consignment note, one invoice goes to the supplier and the recipient, and one more is kept by the customs officer.

If the seller or the buyer has doubts about how to make an invoice, it is better not to rely on “chance”, but to consult with experts.

What language is the invoice for payment filled in?

Tax experts note: documents in a foreign language, which are the basis for accounting records, must be translated into the specified language. Based on this, there are two ways to solve the issue: either to translate the invoice into Ukrainian and English at once, or to provide an authentic translation of a foreign language document into Ukrainian.

How to check the document

The invoice is subject to verification. A competent merchant will always pay attention to the following points:

  1. Terms of delivery, according to INCOTERMS-2020
  2. Completeness of the characteristics of the goods (in case of incomplete data, the document must be amended).
  3. Whether the invoice contains the value of goods in the monetary currency of a particular state.
  4. Availability of prices for each product and their total value.
  5. The presence of the shipper’s signature.

Below you can download and print the invoice template:

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