What is a receipt

When you buy an item in a store or eat out at a restaurant, you will receive a receipt after you have paid. If you shop online, you will also receive a receipt or an invoice for the purchase.

A receipt is documentation of a transaction. For those who run a business, it becomes documentation of the purchase when you keep accounts. A receipt that is included in an account must have correct and sufficient information to be valid documentation.

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What makes a receipt valid documentation?

Any receipt or proof of purchase provided to customers must include the business name and Corporate Indian Number (CIN), the date of supply, details on the product or service, and the price.

Is receipt same as invoice?

An invoice and a receipt serve distinct purposes in the financial transaction process. An invoice is generated before the customer makes a payment, functioning as a formal request for payment. In contrast, a receipt is issued after the payment has been received, serving as conclusive evidence of the completed transaction.

In essence, an invoice initiates the payment process by requesting funds, while a receipt confirms and acknowledges the receipt of payment.