Quotes & Proforma
Make quotes and proforma invoices: priced offers that do not touch stock or the books until you convert them.
Why and when you use it
A proforma invoice looks like an invoice but is only an offer. Customers often need one to approve a purchase or to send an advance payment, and government offices and companies frequently ask for it. Because it does not reduce stock or add GST, you can issue it freely and convert it into a real invoice only when the deal is done.
Before you start
- Add the customer in Customers with their GSTIN and state
- Make sure product prices and GST rates are correct in Inventory
Step by step
- Open Quotes & ProformaOpen Quotes & Proforma from the Sales area to see your existing quotes and proformas.
- Create a new quote or proformaStart a new document and choose the customer. Use a proforma when the customer needs an invoice-like document to process payment.
- Add the itemsAdd products with quantity and rate. The GST appears as it would on the real invoice, based on the customer's state.
- Write the termsAdd notes such as advance required, delivery period and validity. These help the customer's accounts team.
- Save and sendSave it and print or share it with the customer.
- Record the advance if paidIf the customer pays an advance against the proforma, record it in Advance Payments so it can later be adjusted against the invoice.
- Convert when confirmedWhen the order is confirmed, convert the proforma. Only then do stock, GST and the customer's balance change.
Worked example
Sunrise Public School in Lucknow wants to buy 10 steel cupboards from Patel Engineering Works, Rajkot, at ₹8,500 each. The school's accounts office needs a proforma invoice before it releases a 50% advance.
- Patel Engineering Works opens Quotes & Proforma and creates a proforma for Sunrise Public School.
- Adds Steel Cupboard, quantity 10, rate ₹8,500: taxable ₹85,000.
- Because the school is in Uttar Pradesh and the seller is in Gujarat, GST shows as IGST at 18%: ₹15,300. Total ₹1,00,300.
- Notes: 50% advance with order, balance before dispatch. Delivery in 10 days. Valid 30 days.
- Saves and emails the printout to the school's accounts office.
Result: The proforma for ₹1,00,300 is saved with no effect on stock or GST. When the ₹50,150 advance arrives it is recorded in Advance Payments; when goods are ready, the proforma is converted and the real invoice is raised.
💡 Tips
- Write "Proforma - not a tax invoice" style terms in notes if your customer's office is unfamiliar with proformas.
- Use the same rates on the proforma and the final invoice, or the customer's accounts office will ask questions.
- Check with your CA how to treat GST on advances received for your type of supply.
⚠️ Common mistakes
- Counting proformas as sales. They are offers only; your sales reports and GST returns show only real invoices.
- Taking an advance and not recording it, so the customer later appears to owe the full amount.
Questions
Can I claim GST input on a proforma I receive?
No. Input tax credit comes from the supplier's actual tax invoice, not a proforma.
Can I change a proforma after sending it?
Yes, it is only an offer. Once converted to an invoice, the invoice rules apply and only due date and notes can be edited.
🎬 Video walkthrough (script — recording coming soon)
- Scene 1: Open Quotes & Proforma and explain quote versus proforma.
- Scene 2: Create a proforma for Sunrise Public School with 10 steel cupboards.
- Scene 3: Show IGST because the buyer is in another state.
- Scene 4: Add advance and delivery terms in notes and save.
- Scene 5: Record the advance in Advance Payments.
- Scene 6: Convert the proforma when the order is confirmed.