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An invoice or bill is (according to Wikipedia article) a commercial document issued by a seller to the buyer, indicating the products, quantities, and agreed prices for products or services the seller has provided the buyer. An invoice indicates the buyer must pay the seller, according to the payment terms.

From the point of view of a seller, an invoice is a sales invoice. From the point of view of a buyer, an invoice is a purchase invoice. The document indicates the buyer and seller, but the term invoice indicates money is owed or owing. In English, the context of the term invoice is usually used to clarify its meaning, such as "We sent them an invoice" (they owe us money) or "We received an invoice from them" (we owe them money).

Basic invoice

Bargain Hunter
1209 Main
Lewiston, Idaho 83501

Invoice No
Description Amount Owed:
Invoice Total $

A typical invoice contains

The US Defense Logistics Agency requires an employer identification number on invoices.

The European Union requires a VAT (value added tax) identification number on invoices between entities registered for VAT. If seller and buyer belong to two different EU countries, both VAT identification numbers must be on the invoice in order to claim VAT exemption (VAT exemption according to directive 77/388/CEE of 17 May 1977). In the UK, if the issuing entity is not registered for VAT, the invoice must state that it is "not a VAT invoice".

There are different types of invoices:

Utility bills

Bills from utility companies are based on measured (metered) use of electricity, natural gas or other utilities at a residence or business. When an individual or business applies for service from the utility (opens an account), he signs an agreement (contract) to pay for his metered use of the utility.

Electronic invoices

Some invoices are no longer paper-based, but rather transmitted electronically over the Internet. It is still common for electronic remittance or invoicing to be printed in order to maintain paper records. Standards for electronic invoicing or

Online Invoicing

varies widely from country to country. Electronic Data Interchange (EDI) standards such as the United Nation's EDIFACT standard include message encoding guidelines for electronic invoices.

But the most common continues to be PDF over email.


The United Nations standard for electronic invoices ("INVOIC") includes standard codes for transmitting header information (common to the entire invoice) and codes for transmitting details for each of the line items (products or services). The "INVOIC" standard can also be used to transmit credit and debit memos. The "IFTMCS" standard is used to transmit freight invoices.


Use of the XML message format for electronic invoices has begun in recent years. There are two standards currently being developed. One is the cross industry invoice under development by the United Nations standards body UBL (Universal Business Language) which is issued by [Oasis]. Implementations of invoices based on UBL are common, most importantly in the public sector in Denmark. Further implementations are under way in the Scandinavian countries as result of the NES (North European Subset) project. Implementations are also underway in , Italy, Spain, Holland and with the European Commission itself.

The NES work has been transferred to [CEN], (the standards body of the European Union) workshop CEN/BII, for public procurement in Europe. The result of that work is a pre-condition for PEPPOL, pan European pilots for public procurement, financed by the European commission. There UBL procurement documents will be implemented in cross border pilots between European countries.

Agreement has been made between UBL and UN/CEFACT for convergence of the two XML messages standards with the objective of merging the two Online Invoicing standards into one before end of 2009 including the provision of an upgrade path for implementations started in either standard.

Payment for invoices

Organizations purchasing goods and services usually have a process in place for approving payment on the invoice based on an employee's confirmation that the goods or services have been received.