Quotation vs invoice: the difference between a quotation and an invoice

The difference in one minute

• Timing: a quotation comes before the work; an invoice comes after the work or sale is agreed
• Purpose: a quotation offers a price; an invoice asks to be paid
• Money owed: nothing is owed on a quotation; an invoice shows an amount due
• Can it change? A quotation can be revised until it is accepted; an invoice should be corrected with a credit note, not edited
• Number: quotations and invoices each have their own numbering series
• VAT: only an invoice from a VAT-registered business is a tax invoice

A quotation is an offer

A quotation tells the customer what you will do and what it will cost, before the work starts. Nothing is owed yet. The customer can accept it, ask for changes or decline.

• The scope of work, in enough detail that both sides mean the same thing
• Each service or item with its quantity and price
• The total, and whether VAT applies
• How long the price is valid
• Your terms: advance payment, what is not included, warranty

An invoice is a request for payment

An invoice is sent when the work is done or the sale is agreed. It states what is owed and how to pay.

• An invoice number and date
• What was supplied, with quantities and prices
• The total, and VAT if you are registered
• The due date or payment terms
• Your bank details or a way to pay online

When to send which

• Before a job with a price to agree: send a quotation
• After the customer approves: turn the quotation into an invoice
• For an advance payment: send an invoice for the advance, and record the part payment
• For a small, fixed-price job done on the spot: an invoice alone is enough

Turning a quotation into an invoice

Typing the same lines twice is where mistakes happen. In Tichkuly CRM an approved quotation becomes an invoice in one tap, with the same customer, lines and prices, and its own invoice number.