When sourcing products from China and Vietnam for the UK market, understanding the critical differences between proforma and commercial invoices can mean the difference between smooth customs clearance and costly delays, legal complications, and financial losses.
With UK customs requirements becoming increasingly stringent post-Brexit, and new documentation requirements coming into effect in 2025, proper invoice management is essential for compliance and cost control.
A proforma invoice is a preliminary document provided by a seller to a buyer before a formal sales agreement is reached. In the context of sourcing from China and Vietnam, it serves as a detailed quotation that outlines expected costs, terms, and specifications.
Chinese suppliers typically provide detailed proforma invoices as standard practice. These often include:
Vietnamese suppliers may require more guidance on proforma invoice preparation, particularly:
A commercial invoice is the official document that represents a completed sale transaction between the buyer and seller. It serves as both a legal demand for payment and the primary document for customs clearance when importing goods into the UK.
Commercial invoice values must include all costs up to the UK border, including freight and insurance, for accurate duty calculation.
| Aspect | Proforma Invoice | Commercial Invoice |
|---|---|---|
| Legal Status | ❌ Not legally binding | ✅ Legally binding |
| Payment Obligation | ❌ No payment required | ✅ Payment demanded |
| UK Customs Clearance | ⚠️ Limited use (samples only) | ✅ Required for all imports |
| VAT & Duty Calculation | ❌ Cannot be used | ✅ Primary basis |
| Accounting Records | ❌ Not acceptable | ✅ Required for books |
| Modification | ✅ Can be changed | ❌ Final document |
| Timing | 📋 Before order confirmation | 📦 With/after shipment |
| Purpose | 💡 Quotation & planning | 💰 Payment & compliance |
Request quotes from Chinese/Vietnamese suppliers with detailed specifications
Receive and negotiate terms, quantities, and specifications
Agree on final terms and place purchase order
Receive commercial invoice for payment and customs clearance
Note: If importing from Vietnam and your goods qualify under the UKVFTA, the duty rate may be reduced to 0%, significantly lowering the total landed cost.
| Violation Type | Penalty Range | Additional Consequences |
|---|---|---|
| Incorrect HS Code Classification | £100 - £2,500 | Duty adjustment + interest |
| Undervaluation of Goods | £500 - £50,000 | Enhanced scrutiny, audit risk |
| Missing Safety & Security Declaration | £250 - £5,000 | Shipment refusal |
| Non-compliant Product Import | £1,000 - £25,000 | Product seizure, destruction |
| Incomplete Commercial Invoice | £100 - £1,000 | Clearance delays, storage costs |
| Description | Qty | Unit Price | Total |
|---|---|---|---|
|
[Product Description] HS Code: [Code] |
[Quantity] | £[Price] | £[Total] |
| Description & HS Code | Qty | Unit Price | Total |
|---|---|---|---|
|
[Detailed Product Description] HS Code: [10-digit code] Origin: [Country] |
[Quantity] | £[Price] | £[Total] |
Understanding the critical differences between proforma and commercial invoices is essential for compliant, efficient, and profitable sourcing from China and Vietnam.
Avoid penalties and ensure smooth customs clearance
Accurate pricing and duty calculations
Build stronger supplier partnerships
Epic Sourcing's expert team can help you implement best practices for invoice management, ensure full UK compliance, and optimise your China and Vietnam sourcing operations.
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