Pro forma invoices explained

What a pro forma invoice is

A pro forma ("as a matter of form") invoice sets out what you intend to charge: the work or goods, quantities, prices and terms. HMRC's VAT guide describes pro forma invoices as often being used to offer goods or services to potential customers, where the supply won't go ahead unless payment is received. It's an offer and a payment request, not a record that a sale has happened.

How it differs from a real invoice

HMRC says a pro forma can't be used as evidence to reclaim input tax, even if it shows all the details of a VAT invoice, and you should make sure it's clearly marked "this is not a VAT invoice". Marking it is good practice even if you aren't VAT registered, because it stops a client's accounts team booking it as a bill.

When contractors use one

• Upfront payment from a new client, where you won't start or order materials until money arrives.
• Deposits on bigger jobs, especially when you're buying materials. The pro forma shows the full job and the deposit due now.
• Clients who need paperwork to raise a purchase order: some companies can't approve spending without a document showing the cost.
• Confirming a price in a more formal layout than an email, although a quote usually does this better.

Worked example: a deposit

A tiler agrees a bathroom at £1,450.00 labour plus £620.00 of tiles and adhesive that the tiler will buy. They ask for the materials up front.

1. Pro forma PF-007 (marked "Pro forma – not an invoice"): full job £2,070.00; payment requested now £620.00 for materials; balance of £1,450.00 to be invoiced on completion.
2. The client pays £620.00. At this point, issue a real invoice for the amount received, say invoice 00072, "Materials deposit for bathroom, per PF-007, £620.00, paid 19/10/2026". Some businesses instead record the deposit and include it on the final invoice; either way, the real invoice, not the pro forma, is your record.
3. On completion, issue invoice 00075 for labour £1,450.00, referring to PF-007 and invoice 00072.

Check the sums: £620.00 + £1,450.00 = £2,070.00, so nothing is invoiced twice and nothing is missed.

What to put on a pro forma

• A clear title: "Pro forma invoice" and "This is not a VAT invoice" (or "not an invoice").
• A reference from a separate series (PF-001, PF-002…), never from your invoice sequence.
• Your details and the client's.
• The work or goods, quantities, prices and total.
• What's being requested now and by when, plus what happens next ("work starts on receipt of payment").
• How long the offer stands.

Mistakes to avoid

• Recording it as income. A pro forma isn't a sale. Record income from the real invoice (or the payment).
• Using your invoice numbers. It leaves gaps or duplicates in your sequence. See our numbering guide.
• Chasing it like an overdue invoice. Until the work is done or the client has agreed to pay, it's a request. If they don't pay, you simply don't start.
• Forgetting the final invoice once the deposit has been paid.

Worked example: pro forma, then the real invoice

A homeowner hires Chris to fit a kitchen for £4,800 and agrees to pay £1,200 for materials up front.

1. Chris sends Pro forma PF-012 for £1,200, "Deposit for materials, kitchen at 9 Elm Road". It isn't numbered in his invoice sequence.
2. The customer pays £1,200. Chris sends a receipt or a paid invoice for the deposit.
3. When the work is finished, Chris issues Invoice 00077 for £4,800, with a line "Less deposit received 3 Oct (PF-012): −£1,200.00" and "Balance due: £3,600.00".

If Chris were VAT registered, the deposit is a payment in advance, so he'd normally need to issue a proper VAT invoice once it's paid, because receiving payment creates a tax point. A pro forma doesn't do that job.

Label it clearly

Write "Pro forma invoice – this is not a VAT invoice" at the top, and use a separate number series. That stops the customer's bookkeeper treating it as a bill they've already received, and stops it being counted twice in your own records.

If the job is cancelled

Because a pro forma isn't a demand for payment, there's nothing to credit if it's never paid. If a deposit was paid and the job is cancelled, refund it (less any agreed, non-refundable costs) and keep a note of what happened alongside the pro forma.

Keep pro formas in their own folder or series (PF-001, PF-002…) so your real invoice numbers stay unbroken. Your accountant will only want the real invoices and receipts, not the pro formas.

For longer jobs paid in several parts, see how to invoice deposits and stage payments.