Invoice vs bill vs receipt: which document goes where in the books
A supplier's invoice is a request for payment, and in your books it becomes a bill: money you owe. A receipt is proof that you already paid, and it becomes an expense, not a bill. When you pay a supplier invoice later, record the bill once and then the payment. Recording both a bill and an expense for one purchase counts the cost twice.
General information for bookkeepers, not accounting, tax or legal advice. Rules and software screens differ by country and change over time.
Same paper, different names
The supplier calls the document an invoice. You, the buyer, record it as a bill, because it is a payable. Your own invoice to a customer is the mirror image: a sales invoice for you, a bill for the customer.
A receipt is different in kind. An invoice asks for money; a receipt says money has already changed hands. That one distinction decides most of where each document goes.
Where each document goes
| Document | What it tells you | Record it as | Typical names in QuickBooks Online / Xero |
|---|---|---|---|
| Supplier invoice, not yet paid | You owe this by a due date. | A bill, then a bill payment | Bill / Bill |
| Receipt for something already paid | You paid this, on this date, this way. | An expense dated on the payment date | Expense / Spend money |
| Supplier credit note | The supplier owes you a reduction. | A credit that reduces what you owe | Vendor or supplier credit / Credit note |
| Supplier statement | The supplier's view of your account. | Nothing. Use it to reconcile. | Not entered |
| Purchase order, quote, pro forma | An intention, not a charge. | Nothing in the ledger yet | A PO can be created; it does not post |
Deciding where a document goes
Work down the questions and stop at the first yes. The last step applies to every document you record.
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Has it been paid already?
A document that shows a payment method and a zero balance is a receipt. Record an expense dated on the payment date.
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Does it ask you to pay later?
A due date or payment terms mean a bill. Date it on the invoice date and settle it with a bill payment.
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Does it reduce what you owe?
A credit note or refund is a credit. Link it to the original bill where your software allows.
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Is it a statement, quote, pro forma or delivery note?
File it. Use the statement to reconcile, and wait for the real invoice before you record anything.
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Is this purchase already in the books?
A card purchase may already sit in your bank feed. Match it instead of adding it again.
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Attach the document
Attach the PDF or photo to whatever you record, so each entry has one document behind it.
One purchase, two documents
You buy a printer for 249.00 on the business card on the 14th. The shop emails an invoice, and the card feed shows 249.00 the same day.
- Right, option one. Match the feed line to a single expense and attach the invoice. One cost, one document.
- Right, option two. Enter a bill dated the 14th, record the card payment against it, and match the feed line to that payment.
- Wrong. Enter the bill and also categorise the feed line as an expense. The printer is now 498.00 of cost, and a 249.00 payable stays open for something you already paid.
Both right options leave the same cost in the books. Choose one routine for card purchases and use it every time.
The grey cases
- Paid by card, with an invoice. Record the purchase once, as above.
- Part-paid invoices. An invoice that shows a deposit already paid still needs a bill for the full amount, with the deposit applied. If the deposit was recorded separately, ask your accountant how to link them.
- Pay-first invoices. If a supplier asks for payment before delivery, ask your accountant how to record the prepayment.
- Receipts that double as tax invoices. In some jurisdictions only a document with specific details supports a tax claim. Rules differ, so ask your accountant.
What goes wrong
Double counting
A bill is entered for the invoice, then an expense for the card receipt. The cost appears twice and the bank reconciliation will not clear.
A statement booked as a bill
A statement repeats invoices you already hold. Entering it doubles every line on it.
The wrong date
A bill belongs on the invoice date, an expense on the payment date. Swapping them moves cost between months.
A receipt where an invoice is needed
Receipts often omit your business name, the supplier's tax number and an invoice number. See what a receipt lacks.
How BillToCSV helps
BillToCSV covers both sides. Supplier invoices go through the bill converter, which writes QuickBooks and Xero bill import files with every total checked. Receipts go through the receipt converter into a review CSV with one row per item and a check on the total. The QuickBooks and Xero files treat the merchant as the supplier, so they suit firms that enter receipts as bills. It does not decide which treatment your books use. Free: 1 file per day, up to 10 pages, no account. See pricing.
Questions people ask
Is an invoice the same as a bill?
The same paper, seen from two sides. The seller issues an invoice, and the buyer records it as a bill in accounts payable. In accounting software, a bill is a supplier invoice you owe, and an invoice is usually one you send.
Is a receipt the same as an invoice?
No. An invoice requests payment and usually carries terms. A receipt confirms payment. A receipt can still support an expense, but it often lacks details an invoice has.
Should I enter a receipt as a bill?
If it is already paid, an expense is usually simpler because it leaves no open payable. Some firms enter receipts as bills and pay them straight away. Pick one method and stay consistent.
Where does a supplier statement go?
Nowhere in the ledger. Compare it with your open bills to find missing invoices and unapplied payments, then enter any genuinely missing invoice from its own document.
What about a pro forma invoice?
A pro forma works like a quote and is usually not a tax invoice. Do not enter it as a bill unless you are prepaying, and then ask your accountant how to record it.
Do I need the original invoice if I have a receipt?
Sometimes. Rules on records and on reclaiming tax differ by country and by amount, so ask your accountant what you must keep.