What Is an Invoice?
An invoice is a document a seller sends to a buyer before payment has been made. It lists what was provided, at what price, and asks the buyer to pay by a certain date. In short, an invoice says: 'here is what you owe.'
What Is a Receipt?
A receipt is issued after payment has been received. It confirms that a transaction is complete and serves as proof of purchase for the buyer — useful for returns, warranties, expense records, and taxes. A receipt says: 'this has been paid.'
Key Differences
The core difference is timing and purpose: an invoice requests payment, while a receipt confirms payment has already happened. An invoice is typically sent once, before payment; a receipt is issued once, after payment is received.
Invoices are also used for accounting and cash-flow tracking on the seller's side, since they represent money that is owed but not yet collected. Receipts, by contrast, are primarily kept by the buyer as evidence of what they paid and when.
When to Use Each
Use an invoice any time you're billing a customer for work or goods and expect payment afterward — this is standard for freelancers, agencies, and most B2B transactions. Use a receipt any time a payment has just been completed, whether that's a one-off sale, a deposit, or a full invoice payment, so the customer has a clear record of the transaction.