difference between a bill and an invoice

The Difference Between a Bill and an Invoice


In business, the terms “bill” and “invoice” are often used interchangeably. However, there are subtle differences between these two types of payment requests. Knowing the difference is essential for business owners, contractors, and freelancers to ensure they get paid promptly and accurately.

What is an Invoice?

An invoice is a document that outlines the products or services provided by a business, along with the prices and payment terms. It is a legal document that serves as a record of the transaction between the buyer and the seller. Invoices are typically issued before payment has been made and are used to request payment from the buyer.

What is a Bill?

A bill is a payment request that is issued after the goods or services have been delivered or received. It summarizes the charges for the products or services received and typically includes instructions on how and when to pay the bill. Bills are usually issued by external vendors and suppliers, but they can also be issued by internal departments within a company.

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The Differences Between an Invoice and a Bill

The primary difference between an invoice and a bill is the timing of the payment request. An invoice is issued before payment has been made, while a bill is issued after payment has been made. Additionally, an invoice is typically more detailed than a bill and provides a breakdown of the products or services provided, along with pricing information. A bill, on the other hand, is a summary of the charges owed and does not typically include as much detail.

Which One Should You Use?

Whether you should issue an invoice or a bill depends on the nature of your business and the payment terms you have agreed upon with your customers or suppliers. If you are providing goods or services to a customer, you should issue an invoice before payment has been made. If you are receiving goods or services from a supplier, you can expect to receive a bill once the goods have been delivered or the services have been performed.


Understanding the differences between an invoice and a bill is important for anyone involved in business transactions. While these terms are often used interchangeably, they serve different purposes and are issued at different times during a transaction. By understanding the difference, you can ensure that payment requests are issued accurately and that payment is received on time.

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Table difference between a bill and an invoice

Attribute Bill Invoice
Legal Definition A bill is a request for payment that is not legally binding. An invoice is a legally binding document that requests payment for goods or services provided.
Issuance A bill can be issued before or after goods or services are provided. An invoice is typically issued after goods or services have been provided.
Payment Expectation Payment for a bill is expected, but not necessarily immediate. Payment for an invoice is typically expected immediately or within a set timeframe.
Contents A bill usually contains a list of charges for goods or services rendered. An invoice typically contains more detailed information such as product descriptions, quantities, prices, and taxes.
Intended Recipient A bill is typically sent to the person responsible for paying for the goods or services rendered. An invoice is typically sent to the person or company that will be paying for the goods or services rendered.