In one line
Proof that a payment was made, issued after the money arrives.
Also called a payment receipt, proof of payment, or a paid invoice.
What it means in practice
An invoice asks for payment and a receipt confirms it. A receipt names what was paid for, the amount, the date, the method, and any balance still outstanding.
Issue one for every deposit and every cash payment without being asked. On a part payment it doubles as the reminder of what is left.
Example. "Deposit received 4 September, $6,000. Balance of $9,000 due on completion."
Where it shows up on the paperwork
What was paid for, the amount, the date, the method, the invoice it settles, and any balance still outstanding. A PAID stamp is convention rather than a requirement.
What goes wrong
- Only issuing receipts when asked, so cash payments go unrecorded on both sides.
- Issuing a receipt that says paid in full for a part payment.
- Leaving the invoice number off, which makes the receipt hard to match later.
The tools for this
Related terms
- InvoiceA document that asks a client for payment for work already delivered.
- Balance dueThe amount still owed on a job after any deposit or part payment.
- DepositPart of the price paid before the work starts, credited against the final balance.
- ChargebackA card payment reversed by the client's bank after it has already reached you.
Common questions
Do I have to give a receipt?
Rules vary by state and by how the payment was made, but it is good practice for every payment and near-essential for cash, where nothing else records that it happened.
What is the difference between an invoice and a receipt?
An invoice asks for payment; a receipt confirms it arrived. Many jobs need both.
Can a receipt show a balance?
Yes, and it should on a part payment: what was received, and what is still owed with a way to pay it.