When starting a business, there are many things an owner has to juggle. Not only does a business plan have to make an appearance (preferably in the beginning) but the owner also needs to manage employees, create a product or service, get new clients while making old ones happy, grow the business, and implement proper invoicing services.
Focusing in on invoicing, knowing when you need a customs invoice is an important step for any business owner, especially if you’re wanting to take your business overseas. But new entrepreneurs might not really know what a customs invoice is and when they should use one. To understand the basics of customs invoices, consider the following guide.
A customs invoice
A customs invoice is an invoice that is used—and required—at customs, and is also commonly referred to as a commercial invoice. According to BusinessDictionary, this type of invoice is an extended form of commercial invoice required by customs in which the exporter states the description, quantity and selling price, freight, insurance, and packing costs of the goods for the purpose of determining customs import value at the port of destination.
This type of invoice contains information about your parcel and needs to travel with it. It’s required for customs clearing. Without it, your shipment can’t leave the country. ParcelHero states that a customs invoice needs to include collection and delivery addresses, summarized and itemized goods descriptions, total shipment value, the receiver’s tax status, and reason for export, among other details.
A customs invoice is an extended form of the commercial invoice used during foreign trade, and it’s important to check with customs to see what you need to include in your invoice.
When do you need to use one?
You need to use a customs invoice when you’re partaking in foreign trade. Typically, this takes place when an individual or corporation ships goods (such as computer or machine parts, or a product) across international borders.
If an individual or corporation isn’t involved in a foreign trade and doesn’t have to go through customs, then a customs invoice isn’t necessary and typical invoice printing and mailing services, as well as invoicing procedures, can take place.
A standard invoice
While there are different kinds of invoicing, a standard invoice is what businesses and individuals typically use to bill for their services and products when foreign trade isn’t involved.
As the name suggestions, these invoices are standard and don’t have a strict structure, although it’s best to include who you’re invoicing, the amount to be paid, and a description of services or the product you provided to the customer. The invoice number, the name of the seller and company name, as well as the address and contact information are also commonly seen on standard invoices.
If you’re shipping to anywhere in the US, a standard invoice should be enough, although it’s best to check with local and state laws just to be sure.
There are many websites that specialize in invoice printing and mailing services for standard invoices, as well as customs/commercial invoices. It’s important to use the right type of invoice for your products and services. As long as you aren’t shipping something overseas commercially, you shouldn’t have to use a customs invoice and a standard invoice should be sufficient.
If you aren’t sure if you need to use a commercial invoice or what to include on it, then check with customs beforehand so you can provide the necessary information.