Procurement documents decoded: what each one does, who sends it and what to check

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How these guides are built

Each page is written by the Procurement VMS editorial team and reviewed before publication. We write from the rules as published by tax authorities, customs bodies and standards groups, and we link to them. Where a rule changes by country we say so and name the country. Where we are not certain, we say that too. Every tax or legal page carries a last-checked date.

We are an independent ratings and comparison site for procurement software, not a software vendor. Some of these documents are easier to manage in a system than in a spreadsheet, and when that is true we say so on the page. You can read how we rate software in our methodology, or look at our ranked procurement software list once your documents are under control.

The full library

Invoices and billing

• Credit MemoA credit memo reduces what a customer owes or records a supplier credit.
• Credit NoteA credit note reduces what a buyer owes after returns, discounts or billing errors.
• Debit MemoA debit memo can be a bank charge, a buyer returning goods or a seller adding a charge.
• Debit NoteA debit note asks for more money or records a return of goods, depending on who issues it.
• E-InvoicingE-invoicing exchanges invoices as structured data, not PDFs.
• Invoice ExampleSee three filled-in invoice examples, for goods, a fixed-fee service and hourly work, with notes on each line.
• Invoice NumberEvery invoice needs a unique number.
• Past Due InvoiceWhen an invoice goes past due, a clear reminder sequence works better than anger.
• Peppol E-InvoicePeppol is an international network and set of standards for e-invoices.
• Proforma InvoiceA proforma invoice is a preview of the final bill, sent before goods ship.
• Progress Billing InvoiceProgress billing invoices a project in stages based on work completed.
• Purchase InvoiceA purchase invoice is the invoice a buyer receives from a supplier for goods or services.
• Recurring InvoiceA recurring invoice is sent automatically on a set schedule for repeat services.
• Self-Billing InvoiceA self-billing invoice is issued by the buyer for goods or services it bought.
• Service InvoiceA service invoice bills for work rather than goods.
• Types of InvoicesInvoices come in several types: standard, proforma, commercial, tax, recurring, progress and more.
• Vendor InvoiceA vendor invoice is a bill from a supplier for goods or services.

Payment and settlement

• Check Request FormA check request form asks finance to issue a payment that has no purchase order.
• Payment ReceiptA payment receipt confirms the seller received payment.
• Payment VoucherA payment voucher records and authorises a payment to a supplier or staff.
• Performance Bank GuaranteeA performance bank guarantee is a bank promise to pay a buyer if a supplier fails to perform.
• Proof of PaymentProof of payment shows money reached the right account.
• Remittance AdviceA remittance advice tells a supplier which invoices a payment covers.
• Statement of AccountA statement of account lists invoices, payments and the balance between two parties over a period.

Payment and trade terms

• 2/10 Net 302/10 net 30 gives a 2 percent discount for paying within 10 days, else full payment in 30.
• DDP (Delivered Duty Paid)DDP puts duties, taxes and delivery on the seller.
• Due on ReceiptDue on receipt means payment is expected as soon as the customer receives the invoice.
• Ex Works (EXW)Ex Works means the seller makes goods available at its own premises and the buyer takes on everything after.
• FOB DestinationFOB destination means title and risk stay with the seller until the goods arrive at the buyer.
• FOB Shipping PointFOB shipping point means the buyer owns the goods and carries transit risk once the seller hands them to the carrier.
• Net 15Net 15 means payment is due 15 days after the invoice.
• Net 30Net 30 means payment is due 30 days after the invoice date.
• Net 45Net 45 gives the buyer 45 days to pay.
• Net 60Net 60 gives the buyer 60 days to pay.
• Net 90Net 90 gives the buyer 90 days to pay an invoice.
• Payment TermsPayment terms set when and how a buyer pays a supplier.
• Trade TermsTrade terms set who arranges and pays for transport, insurance and customs, and where risk passes.

Shipping and receiving

• Advance Shipping Notice (ASN)An advance shipping notice tells a buyer what has shipped before it arrives.
• Air WaybillAn air waybill is the transport document for air cargo.
• Bill of LadingA bill of lading is the carrier's receipt, the transport contract and sometimes the title to the goods.
• Certificate of OriginA certificate of origin states the country where goods were made.
• Commercial InvoiceA commercial invoice is the bill customs uses to value and clear an international shipment.
• Delivery NoteA delivery note lists what was delivered and is signed by the receiver.
• Packing List (Shipping)A packing list details what is in each package of a shipment, with weights and dimensions.
• Packing SlipA packing slip travels with the parcel and tells the receiver what is inside.
• Proof of Delivery (POD)Proof of delivery shows goods reached the right place and person.
• Shipping DocumentsA shipment needs a set of documents that agree with each other.

India tax and GST documents

• Bill of SupplyA bill of supply is issued when no GST can be charged, as by composition taxpayers or for exempt goods.
• Credit Note under GSTSection 34 of the CGST Act sets how a supplier issues a credit note.
• Debit Note under GSTSection 34(3) of the CGST Act lets a supplier raise a debit note when tax or value on an invoice is too low.
• Delivery ChallanA delivery challan accompanies goods that move without a tax invoice.
• E-Invoice under GST (IRN)GST e-invoicing in India means uploading B2B invoices to the Invoice Registration Portal for an IRN and QR code.
• E-Way BillAn e-way bill is the electronic document that lets goods move under GST in India.
• Form 16AForm 16A is the TDS certificate a payer gives for non-salary payments.
• GST Tax InvoiceSee the fields a GST tax invoice must carry, the time limits for goods and services, who needs an e-invoice, and download a free PDF and Excel template.
• Quotation FormatA quotation is a seller's priced offer.
• TCS under Section 206C(1H)Section 206C(1H) used to make large Indian sellers collect 0.1 percent TCS on sales above INR 50 lakh.
• TDS under Section 194QSection 194Q asks large Indian buyers to deduct 0.1 percent TDS on purchases above INR 50 lakh from one seller.

UK, UAE and Australia

• E-Invoicing in the UAEThe UAE is moving B2B and B2G invoicing to a structured electronic system.
• Recipient Created Tax Invoice (RCTI)An RCTI lets an Australian buyer issue the tax invoice for a supplier.
• Tax Invoice (UAE)UAE VAT law sets what a tax invoice must show, including the words Tax Invoice and the TRN.
• Tax Invoice Requirements (Australia)The ATO sets what a tax invoice must show for GST.
• VAT Invoice (UK)A UK VAT invoice has set content.

Vendor onboarding and tax forms

• Certificate of Insurance (COI)A certificate of insurance summarises a supplier's cover.
• Conflict of Interest FormA conflict of interest form lets staff declare ties to suppliers.
• Form 1099-NEC (vendor payments)Form 1099-NEC reports payments to non-employees.
• Form W-8BENW-8BEN is how an individual outside the US tells a US payer they are a foreign person.
• Form W-8BEN-EW-8BEN-E is the certificate a foreign entity gives a US payer to claim treaty benefits and show its status.
• Form W-9 (for vendors)Form W-9 gives a US business a payee's name and taxpayer identification number.
• Resale CertificateA resale certificate lets a business buy goods for resale without paying sales tax.
• Tax Exemption CertificateA tax exemption certificate lets a qualifying buyer purchase without sales tax.

Contracts and change control

• Contract AmendmentA contract amendment changes the terms of an existing contract in writing.
• Master Service Agreement (MSA)A master service agreement sets the standing terms for a supplier relationship.
• Statement of Work (SOW)A statement of work defines the work, deliverables, timeline and acceptance for one project.

Sourcing and ordering

• Change OrderA change order records an agreed change to scope, price or schedule.
• Letter of Intent to PurchaseA letter of intent to purchase states a buyer's serious plan to buy on certain terms.
• Purchase AgreementA purchase agreement sets the terms for buying goods or assets.
• Sales OrderA sales order is the seller's internal record of a confirmed customer order.

Document comparisons

• Credit Memo vs Debit MemoA credit memo reduces what a customer owes.
• Invoice vs BillAn invoice is what a seller sends.
• Invoice vs ReceiptAn invoice asks for payment and a receipt confirms it.
• Invoice vs StatementAn invoice requests payment for a sale.
• MSA vs SOWAn MSA sets standing legal terms.
• Proforma vs Commercial InvoiceA proforma invoice previews a sale before shipment.
• Purchase Order vs InvoiceA purchase order is the buyer's order and an invoice is the seller's bill.
• Quote vs InvoiceA quote is an offer of a price and an invoice is a request for payment.
• Sales Order vs Purchase OrderA purchase order is the buyer's request.

New to the area? Start with payment terms, the GST tax invoice guide if you work in India, or bill of lading if you ship goods across borders.

Frequently asked questions

Where to read next

• Procurement strategyPlans and playbooks for procurement leaders
• Invoice approval and GRN guideHow invoices are matched and approved
• Free procurement templatesPurchase order, RFQ and other templates
• Procurement glossaryShort definitions
• How we rate softwareOur scoring method