Advance invoice
An advance invoice is the invoice issued for an advance payment received before delivery.
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What does Advance invoice mean?
Under the VAT Act, VAT becomes due when an advance payment is received, so an invoice must be issued for it. The final invoice covers the full amount and deducts the advance already invoiced.
An advance invoice is not a proforma: a proforma only asks for payment, an advance invoice records money received. Check the exact handling with your accountant.
Why does it matter to a small business?
Many small businesses ask for an advance before ordering materials or reserving time for a customer, so they do not carry the risk if the buyer pulls out. An advance is also a tax event, though, so the proforma, the advance invoice and the final invoice need to follow one another in order. Exactly when and how in your case is something to check with your accountant, and NAV's Online Számla site is worth reading too.
What does it look like in practice?
Details
Suppose a joiner in Szeged builds a fitted kitchen and asks for part of the price before starting. First he sends a proforma, which only asks for payment. When the money arrives, he issues an advance invoice for it. Once the kitchen is fitted, the final invoice covers the full amount and deducts the advance already invoiced. Which dates and details go on the invoices he discusses with his accountant.
How does HelloCRM handle it?
Details
HelloCRM marks the document as an advance invoice at the invoicing provider (Számlázz.hu, Billingo).
Module: Invoicing (paid module, price coming soon).
A CRM for small businesses in Hungary
HelloCRM is an online CRM made in Hungary for small and mid-sized businesses there, in Hungarian and English: the core CRM is free for good, with no time limit and no card, and it can be tried without signing up in a demo company full of example data.
Questions
What is Advance invoice, in one sentence?
An advance invoice is the invoice issued for an advance payment received before delivery.
Sources
This is general information, not legal or tax advice. The rules come from: 2007. évi CXXVII. törvény az általános forgalmi adóról (Áfa tv.), Nemzeti Jogszabálytár (checked )