If you’re running a small business, especially in service industries or contracting, you’re probably sending a lot of invoices and handing out receipts. But many business owners still mix up the two. Understanding the difference is key to keeping your books clean, your clients informed, and your cash flow in order.
Let’s break it down—and look at how QuickBooks Online simplifies both.
What’s an Invoice?
An invoice is a request for payment.
You send an invoice before money is exchanged. It lists what products or services were provided, how much is owed, payment terms (like “Net 15”), and how to pay. Think of it as your way of saying:
“Here’s what I did—please pay me by this date.”
In QuickBooks Online:
- You can create customized invoices with your logo.
- Add line items for services, products, hours, or materials.
- Choose payment terms, attach files, and add a “Pay Now” button for easy online payments.
- QuickBooks can also send automatic reminders for unpaid invoices.
What’s a Receipt?
A receipt is a confirmation of payment.
You provide a receipt after your client pays. It shows the amount paid, the payment method, and the date. A receipt is proof that the transaction is complete.
In QuickBooks Online:
- When you receive payment on an invoice, QuickBooks can automatically generate a receipt.
- For cash or card sales with no invoice (like in-person payments), you can create a sales receipt instead.
- QuickBooks records the receipt and links it to the appropriate income and payment accounts for accurate bookkeeping.
Key Differences at a Glance
| Feature | Invoice | Receipt |
|---|---|---|
| When it’s issued | Before payment | After payment |
| Purpose | Request for payment | Proof of payment |
| Triggers payment? | Yes | No |
| Handled by QB? | Yes (Invoice feature) | Yes (Receive Payment or Sales Receipt) |
Why This Matters for Your Business
Confusing invoices and receipts can lead to:
- Double entries
- Missed income
- Unsent follow-ups
- Headaches during tax time
But with a proper bookkeeping system—like QuickBooks Online—you don’t have to worry. It keeps everything organized, tracks open invoices, records payments, and stores receipts all in one place.
Need Help Setting It All Up?
At Family Balanced Bookkeeping, we help business owners like you get the most out of QuickBooks Online. Whether you need help creating invoice templates, automating payments, or making sense of your reports, we’ve got you covered.
👉 Let’s schedule a free consultation and make sure your invoicing—and your income—is working for you, not against you.
To learn more about QuickBooks, click here!
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