Invoice vs. Receipt: Key Differences Explained

1. What is an Invoice?

An invoice is a request for payment sent by a service provider to a client. It details the services provided, rates, and terms, indicating that a payment obligation exists.

2. What is a Receipt?

A receipt is proof of payment issued after the invoice balance has been settled. It details the amount paid, payment method, and confirms that the outstanding balance is now zero.

3. Accounting Implications

Invoices help track accounts receivable (money owed to you), while receipts track actual cash flow and are used for tax write-off logs.