What a proforma invoice is, and when to use one
A proforma invoice is sent before goods are delivered or work begins. It tells the buyer the expected total so they can approve the order, pay a deposit, raise funds, or arrange import and customs paperwork.
Once the buyer accepts and you supply the goods or services, you issue the final tax invoice. Use a proforma when a sale needs a deposit or part-payment, when a client’s accounts team needs a document to raise a payment, when you export or import, and when you want a price that is valid for a set number of days.
Proforma invoice, quotation, tax invoice and receipt
Quotation
An offer- Issued
- Before an order
- Payment demanded?
- No
- VAT
- Shown as an estimate
Proforma invoice
An estimate- Issued
- Before supply, once the buyer is interested
- Payment demanded?
- No. It supports an order or deposit
- VAT
- Shown as an estimate, not collected
Tax (VAT) invoice
The bill- Issued
- When you supply the goods or services
- Payment demanded?
- Yes
- VAT
- Charged, with your Tax ID
Receipt
The proof- Issued
- After payment
- Payment demanded?
- No. It confirms payment
- VAT
- Shows the VAT that was paid
What to put on a proforma invoice
- Your business name, address, phone and email
- Your Tax ID and CAC number
- A clear “Proforma invoice” heading, a unique number and the date
- The client’s name and address
- Each item with a description, quantity and unit price
- The VAT treatment of each item: 7.5%, 0% or exempt
- Any discount, delivery charge and the total, in figures and in words
- A validity date, so the price does not stay open forever
- Payment terms and your bank details (and delivery terms for exports)
- A line saying it is not a tax invoice or a demand for payment
VAT on proforma invoices in 2026
The VAT rate is 7.5% under the Nigeria Tax Act 2025. Basic food, medicines, medical services, school tuition and exports are zero-rated (0% VAT). Land and buildings, baby products and petroleum products are exempt. Small businesses with turnover of ₦100 million or less and fixed assets of ₦250 million or less, other than professional service providers, are not required to charge VAT.
Choose the VAT setting for each line in the generator, or turn VAT off completely if you do not charge it. For the full lists, use the VAT calculator. Your final VAT invoice should show your Tax ID. Find yours here.
Common proforma invoice mistakes
A buyer can return months later and expect the same price.
Zero-rated and exempt items should not carry 7.5%.
Do not claim input VAT on a supplier’s proforma. Wait for the VAT invoice.
Give every proforma its own number so it matches the final invoice and your records.
If you quote in dollars, say so and state the naira rate you will use, if any.
Frequently asked questions
What is a proforma invoice?
A proforma invoice is a preliminary bill that tells a buyer what the goods or services will cost before the sale is final. It lists the items, prices, VAT, delivery and payment terms. It is not a tax invoice and it is not a demand for payment.
What is the difference between a proforma invoice and a quotation?
A quotation offers a price. A proforma invoice looks like a final invoice and is often used when the buyer needs a document to arrange payment, obtain funding or clear imports. Many businesses use the two terms for the same document. The proforma carries an invoice number and a validity date.
Do I charge VAT on a proforma invoice?
A proforma invoice is not a tax invoice, so VAT is not collected on it. It is good practice to show the VAT you expect to charge so the buyer can budget. Issue a VAT invoice with your Tax ID when you supply the goods or services. If you are a small business that does not charge VAT, switch the VAT lines off.
Do I need a Tax ID on a proforma invoice?
It is not required on a proforma, but it builds trust and speeds up the VAT invoice later. VAT invoices show the supplier’s Tax ID. If you do not know yours, check your Tax ID with your NIN or CAC number.
Can I use a proforma invoice to import goods into Nigeria?
Importers usually need a proforma invoice from the overseas supplier to open a Form M with their bank. Ask your bank or clearing agent which details they require, such as the supplier’s address, item descriptions, quantities, unit prices, currency and delivery terms.
Is my information saved or sent anywhere?
No. The invoice is built in your browser and nothing is uploaded. If you tick “Remember my business details”, your business name, address, Tax ID, bank details and logo are kept on this device only, and you can clear them by unticking the box.
How do I save the invoice as a PDF?
Click “Print or save as PDF”. In the print window, choose “Save as PDF” as the destination (on Android, choose “Save as PDF” from the printer list). Only the invoice is printed, not the form.
Sources and last verified date (7 November 2026)
VAT treatments follow the Nigeria Tax Act 2025 and the Nigeria Tax Administration Act 2025. See the sources on the VAT calculator page. Import requirements for Form M vary by bank, so confirm them with your bank or clearing agent.