A pro forma invoice contains the estimated amounts that will later be included in an actual invoice. This type of invoice is used in the following situations:
- Preliminary. A customer may want to know how much will be eventually billed, so that the information can be used to obtain approval for a purchase or to see if there is sufficient budgeted funding available for a purchase.
- Clarity. When an invoice is expected to be quite large or contain many line items, it may be considered good customer relations to send a pro forma invoice to a customer early in a sales transaction, so that the customer understands what it is paying for. This can assist in eventually obtaining payment when an actual invoice is sent.
- Customs documentation. The packet of information needed to pass a delivery through international customs may require that an invoice copy be presented to the customs authorities.
A pro forma invoice is not used for billing purposes, and so may prominently display a notice that this is not an actual invoice.