Quick answer: A sales invoice is the document a seller sends a buyer to request payment for goods or services. It lists what was sold, the quantities and prices, any discounts, tax, or shipping, the total due, and when and how to pay. For the seller, it is also the record of the sale.
"Sales invoice" and "invoice" refer to the same document. The word "sales" signals the seller's side of the transaction. In the buyer's books, the same document is a purchase invoice or a bill.
This guide follows one example invoice from start to finish: what goes on it, how to create and send it, and how the seller and the buyer each record it.
What a sales invoice includes
Some fields belong on every invoice. Others only apply to certain sales, and a few are a matter of preference. The table marks which is which.
| Field | What goes in it | When to include it |
|---|---|---|
| Your business details | Business name, address, and an email or phone number, plus your logo if you use one | Always (logo optional) |
| Invoice number | A unique number that follows your usual sequence | Always |
| Customer details | Customer name and billing address; shipping address if different | Always (shipping address when it differs) |
| Dates | Invoice date, delivery or service date, and due date | Always |
| Line items | Description, quantity, unit price, and line total for each product or service | Always |
| Totals | Subtotal and amount due | Always |
| Discount or shipping charge | The amount, and for a discount, what it was calculated on | When you have agreed to a discount or charge for delivery |
| Sales tax | Tax on its own line, or a note explaining why none is charged | When the sale is taxable or you are relying on an exemption |
| Payment terms | For example, net 30 | Always |
| How to pay | Each payment method you accept and the details needed to use it | Always |
| Late fee or early-payment discount | The fee or discount and when it applies | When your agreement with the customer includes it |
| Customer reference | The customer's purchase order (PO) or order number | When the customer gave you one |
| Tax or registration number | For example, a sales tax permit number | When a state rule or your customer requires it |
The "Always" fields are what a customer needs to identify the invoice, check it against the order, and pay it. They are not a legal checklist. What an invoice must show can depend on your state's sales tax rules and your industry, so check the requirements where you do business.
Sales invoice example
Here is a complete sales invoice from a fictional wholesaler, Maple & Thread Supply Co. in Asheville, North Carolina, to a fictional retailer, Blue Door Boutique in Hendersonville, North Carolina. The goods were delivered on October 29, 2026, and the invoice was issued two days later. The same numbers appear in the accounting section below.
| Invoice no. | 1207 |
| Invoice date | Oct 31, 2026 |
| Delivered | Oct 29, 2026 |
| Due | Nov 30, 2026 (net 30) |
| Customer PO | 3318 |
| Description | Qty | Unit price | Amount |
|---|---|---|---|
| Natural linen tote bag | 50 | $9.50 | $475.00 |
| Indigo cotton scarf | 30 | $14.00 | $420.00 |
| Beeswax candle, 8 oz | 40 | $7.25 | $290.00 |
| Subtotal | $1,185.00 |
| Wholesale discount (5% of merchandise subtotal) | −$59.25 |
| Shipping | $38.00 |
| Sales tax | $0.00 |
| Amount due | $1,163.75 |
How the totals work:
- Subtotal: $475.00 + $420.00 + $290.00 = $1,185.00
- Discount: 5% of the $1,185.00 merchandise subtotal = $59.25. It does not apply to shipping.
- Amount due: $1,185.00 − $59.25 + $38.00 = $1,163.75
Why there's no sales tax on this invoice. The example assumes Blue Door Boutique is registered to collect North Carolina sales tax, is buying these goods to resell, and has given Maple & Thread a completed Form E-595E. This is the certificate the North Carolina Department of Revenue uses for purchases for resale and other exempt purchases. The invoice therefore charges no tax and notes the certificate instead.
A buyer in another state or a purchase for the boutique's own use could change the tax treatment. Your state's department of revenue publishes the rules that apply to you.
For more layouts, see our invoice examples, which include freelance, contractor, consulting, wholesale, and overdue invoices. Our photography invoice guide shows a business that bills for both services and products. If you sell goods to retailers, the wholesaler invoice template is built for the same kinds of charges: quantities, unit prices, discounts, shipping, and tax.
How to create and send a sales invoice
- Start from a template or invoicing software that already holds your business details, so you only fill in what changes from sale to sale.
- Add the customer's details and reference. Use the billing name and address the customer has asked you to use. If they gave you a PO or order number, include it so they can match the invoice to their order.
- Give the invoice a unique number. Use the next number in a consistent sequence (1206, 1207, 1208) and don't reuse numbers, so every invoice and payment can be traced. For formats, legal requirements, and edge cases, see what is an invoice number.
- Set the invoice date, delivery date, and due date. Write the due date out ("Due Nov 30, 2026 (net 30)") rather than only "net 30," so your customer doesn't have to work it out. In the example, net 30 counts from the October 31 invoice date. The delivery date shows which shipment the invoice covers.
- List each product or service so the customer can match it to the order. "50 natural linen tote bags at $9.50" is easier to check than "merchandise." Show the quantity, unit price, and line total for each line.
- Add discounts, tax, and shipping, and show the basis. Say what a discount was calculated on, as in "5% of merchandise subtotal." If you charge sales tax, put it on its own line. If you don't because of an exemption, note why.
- Say how to pay. List each method you accept with the details needed to use it: an online payment link, or for bank transfers, the account name and numbers plus the invoice number as a reference.
- Send it and keep a copy. Send the invoice once you have delivered the goods or services, or when your agreement says to. Keep a copy with your records: the IRS says to keep records that support income on a return until the period of limitations for that return runs out, which is three years in most cases and longer in some (IRS).
- Track it and follow up. If the due date passes, send a reminder that includes the invoice number, the amount outstanding, and a copy of the invoice or the payment link. If the customer disputes a charge, resolve that question before you repeat the payment request.
How the example is recorded in accounting
A sales invoice is a source document: the record that supports an accounting entry. Here is how the example invoice would appear in each business's books, assuming:
- Both businesses use accrual accounting.
- The goods were delivered on October 29.
- Blue Door Boutique hasn't paid yet.
Under the accrual method, income is generally reported when it is earned, regardless of when payment is received (IRS Publication 538). In this example, delivery is what made the revenue earned, not the invoice. The invoice, issued two days later, records the sale. Both events fall in the same monthly reporting period, so they don't shift revenue between months in this example. It would matter if delivery and invoicing fell on either side of the end of a month or tax year.
In the seller's books (Maple & Thread)
| Account | Debit | Credit |
|---|---|---|
| Accounts receivable | $1,163.75 | |
| Sales revenue ($1,185.00 − $59.25 discount) | $1,125.75 | |
| Shipping income | $38.00 |
When Blue Door pays, Maple & Thread debits Cash $1,163.75 and credits Accounts receivable $1,163.75.
This entry covers the sale only. Maple & Thread would also record the cost of the goods it sold (cost of goods sold) and reduce its inventory by the same amount. That cost isn't on the invoice, so it isn't shown here.
If the sale had been taxable, the tax would be credited to Sales tax payable, a liability, because the seller collects it for the state rather than earning it.
A business on the cash method would generally record the income when payment arrives instead. Businesses that sell merchandise have extra rules on which method they can use for those sales. Publication 538 sets them out, and our guide to cash vs accrual accounting covers the choice.
In the buyer's books (Blue Door Boutique)
To Blue Door, the same document is a purchase invoice. A purchase can be recorded as an expense or an asset, depending on what was purchased: office supplies would usually be an expense, a new display case an asset. Here, the boutique bought goods to resell, so they go into inventory. Because the invoice is unpaid, it also creates an amount payable.
| Account | Debit | Credit |
|---|---|---|
| Inventory | $1,163.75 | |
| Accounts payable | $1,163.75 |
The inventory cost is the price of the goods minus the trade discount plus shipping ($1,185.00 − $59.25 + $38.00), which matches how Publication 538 describes the cost of merchandise purchased. When Blue Door pays, it debits Accounts payable and credits Cash for $1,163.75.
If you're the one receiving invoices, confirm any new or changed payment details with the vendor before you pay. Our invoicing best practices guide lists common invoice red flags.
How a sales invoice differs from related documents
| Document | How it differs from a sales invoice |
|---|---|
| Sales order | Confirms what the customer ordered before delivery. It doesn't request payment (see sales order vs invoice) |
| Sales receipt | Confirms a payment already received. If a customer pays at the time of sale, you can give them a sales receipt instead of an invoice |
| Bill of sale | Documents the transfer of ownership of an item, often a vehicle or equipment. It isn't a payment request |
| Proforma invoice | A preliminary invoice sent before delivery to preview the charges (see what is a proforma invoice) |
| Tax invoice | A term from VAT and GST systems outside the US, where tax law sets what the invoice must show. In Australia, for example, that includes the seller's business number and the GST amount (ATO). See what is a tax invoice |
| Commercial invoice | A sales invoice with the extra details customs needs for international shipments (see commercial invoice guide) |
Recurring invoices and hourly (timesheet) invoices are still sales invoices. They differ in when they are sent or how the charges are calculated. Our guide to types of invoices covers them.
Other questions
What is another name for a sales invoice?
Most people just say "invoice." You'll also see bill, customer invoice, and, in some accounting software, A/R invoice. For the broader basics, see what is an invoice.
Creating sales invoices in InvoiceQuick
If you send invoices regularly, InvoiceQuick handles several of the steps above. It fills in the next invoice number and won't accept a number you've already used. It can print your bank transfer details on the invoice. If you connect your own Stripe account, customers can pay by card on the online invoice. Card payments are recorded on the invoice automatically. Scheduled reminders can follow up before and after the due date. For a single invoice, the free invoice generator or one of our invoice templates may be all you need.
General information, not legal or tax advice.
Sources and further reading
- IRS Publication 538, Accounting Periods and Methods: cash and accrual methods, inventories, and the cost of merchandise purchased.
- IRS: How long should I keep records?: record retention periods.
- NCDOR: Form E-595E, Streamlined Sales and Use Tax Certificate of Exemption: North Carolina's certificate for purchases for resale.
- N.C. Gen. Stat. § 105-164.28, Certificate of exemption: when a seller is relieved of liability for sales tax on an exempt sale.
- ATO: Tax invoices: what an Australian GST tax invoice must show, as an example of a non-US tax invoice.
