What is a Commercial Invoice, and What Are Its Characteristics?

Commercial invoice, also known as Commercial Invoice, is a type of sales contract between the buyer and the sender in logistics processes. In order for your products to pass through customs easily when selling abroad, you must sign the relevant contract. With this invoice, expenses such as costs and customs duty are determined. With this content, you can quickly learn the answers to questions such as what is a commercial invoice and what are its features.

Why is a Commercial Invoice Used and What Does It Do?

Commercial invoice is one of the documents most frequently subject to international trade practices. This document, translated into our language as "ticari fatura" and "yabancı fatura", belongs to the class of commercial documents due to its intended use. The difference between this invoice and a proforma invoice is that it is commercialized after the sale in import and export practices.

How to Fill out a Commercial Invoice (Ticari Fatura)? What Information Should It Contain?

The question of what is a commercial invoice can be answered in its simplest form as a commercial invoice. At this point, the most distinguishing nuance is that the information in the invoice is in English. Information such as address, contact details and tax number must be written in English. In addition, information such as buyer and sender should be added to an appropriate place on the invoice. Additional information to be specified can be listed as follows:

• Product description

• Reason for export

• Dispatch date and order number

• Quantity of each product

• Incoterms

• HS Code

• Insurance costs

• Weight

• Country of origin

• Declared values of the products

For the commercial invoice filling process, as a final step you must sign the document. In addition, it is very important that the person signing this invoice also indicates their position in the company on the invoice.

Which Documents are Required for a Commercial Invoice?

In foreign trade applications, it is important that the trade and transport agreements executed by both parties become official. Many documents are used for this purpose. Likewise, there are some documents required for the transport process to be approved by customs. The documents prepared for the commercial invoice are important for the successful, correct and complete execution of purchase and sale transactions between the buyer and the seller. The documents required for a commercial invoice are as follows:

• Customs Declaration

• Proforma Invoice

• Freight Invoice

• Transport and Circulation Documents

• Consular Invoice

It is useful to remind that some of the documents listed above must be prepared in all foreign trade applications. In addition, the freight invoice is only issued in cases where the exporting party undertakes payments.

What is the Role of a Commercial Invoice in Customs Procedures?

A commercial invoice, as we mentioned earlier, is a document required in export practices and is used in the importer's country. With the help of the commercial invoice, it is determined whether customs duty will be applied to the goods during import. Likewise, if customs duty is to be applied to the goods, how much import duty is involved is also understood by looking at the commercial invoice.

It is clear that the scope of questions like what is a commercial invoice and what does it do is wide. Thanks to the relevant document, many customs procedures are performed more easily. Moreover, this document also shows the payment that the importer will make to the exporter. In fact, the payment made is also included on the relevant invoice. From time to time, the identity of the manufacturer and which country they are from can be unclear. In such cases, the parties can quickly learn the required information from the commercial invoice.

How is a Commercial Invoice Used in the Payment Process?

A commercial invoice can be divided into different use groups in payment processes. The relevant document can be prepared more practically in cash against goods, commercial invoice cash against documents and cash-in-advance exports compared to other methods. Except for letters of credit, documents are not reviewed in all payment methods. This makes the commercial invoice document easier to prepare. It is appropriate for invoices to be printed on the letterhead of the seller's side and signed by an authorized person of the firm.

All documents available in letter of credit applications are reviewed by banks. This makes preparing a commercial invoice under a letter of credit more difficult than other payment types. While preparing a commercial invoice under a letter of credit, some conditions are taken into consideration. After a few applications that need to be made, the invoice in question is presented to the bank specifically for the number in question in the letter of credit.

Commercial Invoice Example

A commercial invoice example is among the subjects that those engaged in import and export are often curious about. It is worth underlining that a standard commercial invoice is on no occasion available. Practitioners prepare commercial invoices for each application in line with their own needs and expectations. No foreign trade document content is required to be the same as the content of another document. At this point, on a transaction basis, you can prepare the document that appeals most to you and your needs.

Difference Between Basic Invoice and Commercial Invoice

The difference between a basic invoice and a commercial invoice is at the top of the most curious topics. A commercial invoice, unlike a basic invoice, is a type that has rights of cancellation, acceptance and rejection. The buyer and the seller agree to execute the transaction with a commercial invoice. Following this, the service or product exchange occurs. At the very last stage, the selling party issues and sends the commercial invoice to the buying party.

The selling party prepares the sent commercial invoice and sends it to the buyer. After this stage, the seller's waiting time for a response from the buyer begins. The buyer side can accept the invoice or, on the contrary, reject it. If the buyer side does not process the invoice within 8 days after the relevant invoice reaches them, the relevant documents are automatically accepted by the system. In this sense, the rejection period for a commercial invoice is 8 days.