What is a Commercial Invoice?
One of the most important documents in international trade, the Commercial Invoice is a contract and proof of sale issued by the seller to the buyer. This document describes the goods being sold and details the price, value, and quantity of the goods. The Commercial Invoice does not indicate ownership or carry a title to the goods, that is in the Bill of Lading. However, the commercial invoice is required for Customs clearance.
What is a Commercial Invoice used for?
The breakdown of costs on a Commercial Invoice is used by Customs to calculate and assess the duties and taxes due for the shipment. It can also be used or required for payments, such as in the case where a buyer pays via a Letter of Credit. In that situation, a buyer may need to produce the commercial invoice to the band in order for the funds to be released to the seller.
- Invoice number
- Invoice data
- Order number
- Sale total
- Instructions of payment
Exporter and Importer Information
- Exporter/Seller's name address, phone number
- Exporter/Seller’s tax ID number (VAT, EORI)
- Importer/Buyer’s name, address, phone number
- Importer/Buyer’s tax ID number (VAT, EORI)
- Notify party’s information
- Bill of Lading number
- Forwarding agent
- Harmonized System (HS) code
- Description of goods (number of packages, units, weight)
- Origin of goods
- Exportation date, mode of transport, and final destination
- Shipper’s signature
When creating your Commercial Invoice it is important to include a breakdown of transportation charges and services that the buyer is paying to the seller. This is because the United States does not place a duty on transportation costs, so clearly showing differentiation between these kinds of costs will help importers from incurring unnecessary Customs duties.
What happens if I do not have a Commercial Invoice or fail to fill it out accurately?
A complete and accurate Commercial Invoice is actually a legal requirement. Failing to do so can result in long Customs delays and potential fees. Furthermore, misinformation on a Customs invoice can lead to underpayment for duties and taxes which could, in turn, result in legal ramifications.
Have more questions about Customs invoices? Talk to an expert.
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