What is a commercial invoice? Definition and FAQs

Published on Friday 29 August 2025

Table of contents

• What is a commercial invoice?
• What information goes on a commercial invoice?
• How to create a commercial invoice
• Commercial invoice vs regular invoice
• Managing international sales with Xero
• FAQs on commercial invoices

Key takeaways

• A commercial invoice is required for international shipping and customs clearance.
• It must include details like buyer and seller info, product descriptions, HS codes, and shipping terms.
• Accurate invoices help avoid delays, penalties, and rejected shipments.
• Unlike regular invoices, commercial invoices are used specifically for global trade.

What is a commercial invoice?

A commercial invoice is a key document used in international shipping to declare the contents, value, and details of a shipment to customs authorities.

It serves as proof of sale and helps customs calculate import duties, taxes, and tariffs accurately. Properly prepared commercial invoices are essential for smooth customs clearance and avoiding shipment delays.

What to include on a commercial invoice

Every commercial invoice should include the following information:

Product information:

• Detailed item descriptions and classification
• Quantity and weight of each product
• Unit price and total shipment value

Business details:

• Seller (exporter) information including business name and contact details
• Buyer (importer) information including delivery address and contact
• Sale terms and conditions, such as Incoterms

Shipping costs:

• Insurance fees covering the shipment
• Freight charges for transport
• Additional handling costs, if applicable

Why customs needs a commercial invoice

Customs authorities rely on commercial invoices to:

• Assess tariffs and duties accurately on imported goods
• Verify shipment contents and value for regulatory compliance
• Ensure proper tax collection and prevent fraud or misdeclaration

What information goes on a commercial invoice

A commercial invoice isn’t just a formality—it’s a critical document for international shipping. Customs authorities use it to verify your shipment, calculate duties and taxes, and prevent delays or penalties. Including accurate information ensures your goods move smoothly across borders.

Here’s why each section of a commercial invoice is important:

Seller information Provides customs with details about who is exporting the goods, including business name, address, and tax identification. This ensures your business can be contacted if questions arise about the shipment.

Buyer information: Includes the recipient’s name, delivery address, and any import license number. This helps authorities verify that the goods are going to a legitimate importer and comply with local regulations.

Product details: Detailed descriptions, Harmonized System (HS) codes, country of origin, and quantity help customs classify your goods correctly. Accurate product information prevents shipment delays and avoids fines or additional inspections.

Financial information: Listing the unit price, total value, payment method, and currency allows customs to calculate tariffs, duties, and taxes correctly. This reduces the risk of underpayment or disputes.

Shipping details: Information on shipping date, method, terms of sale (like FOB or CIF), and insurance or freight costs confirms how the goods are being transported and who is responsible for each part of the shipment. This ensures compliance and smooth processing at the border.

Why commercial invoices need accurate information

A commercial invoice isn’t just a formality—it’s a critical document for international shipping. Customs authorities use it to verify your shipment, calculate duties and taxes, and prevent delays or penalties. Including accurate information ensures your goods move smoothly across borders.

Here’s why each section of a commercial invoice is important:

• Seller information: Provides customs with details about who is exporting the goods, including business name, address, and tax identification. This ensures your business can be contacted if questions arise about the shipment.
• Buyer information: Includes the recipient’s name, delivery address, and any import license number. This helps authorities verify that the goods are going to a legitimate importer and comply with local regulations.
• Product details: Detailed descriptions, Harmonized System (HS) codes, country of origin, and quantity help customs classify your goods correctly. Accurate product information prevents shipment delays and avoids fines or additional inspections.
• Financial information: Listing the unit price, total value, payment method, and currency allows customs to calculate tariffs, duties, and taxes correctly. This reduces the risk of underpayment or disputes.
• Shipping details: Information on shipping date, method, terms of sale (like FOB or CIF), and insurance or freight costs confirms how the goods are being transported and who is responsible for each part of the shipment. This ensures compliance and smooth processing at the border

How to create a commercial invoice

To create a commercial invoice, gather specific information and format it according to international standards. Follow these steps to make sure your invoice meets customs requirements.

Step 1: Gather required information

Collect all product details, business information, and shipping costs before starting your invoice.

Step 2: Choose your format

There are several ways to format a commercial invoice depending on your business needs:

• use accounting software with international invoice templates
• download templates from shipping carriers such as FedEx, UPS and DHL
• create your own using the required fields listed above

Step 3: Complete the invoice

• add "commercial invoice" as the document title in the header
• assign a unique reference number as the invoice number
• use the shipment date, not the sale date
• fill in all required fields completely and accurately

Step 4: Review and verify Check all your information for accuracy. Accurate invoices help you avoid customs delays and extra fees. Inaccurate invoices can mean missed revenue for governments and extra costs for you.

Step 5: Create copies Keep copies for your records and provide originals with your shipment.

Step 1: Gather required information

Before you start your invoice, collect all the necessary details, including product descriptions, quantities, unit prices, total value, and country of origin.

You’ll also need your business information, the buyer’s details, shipping method, insurance, and any additional handling costs. Having everything ready upfront helps you avoid errors and omissions.

Step 2: Choose your format

There are several ways to format a commercial invoice depending on your business needs:

• Accounting software: Many accounting platforms, like Xero, offer templates designed for international shipping.
• Shipping carrier templates: FedEx, UPS, and DHL provide downloadable commercial invoice templates.
• Custom format: You can create your own invoice using a spreadsheet or document, as long as it includes all required fields. Choosing a clear, professional format ensures the invoice is easy for customs officials to process.

Step 3: Complete the invoice

Fill in your commercial invoice with all the gathered details:

• Label it clearly as a “Commercial Invoice” in the header.
• Assign a unique reference number for tracking purposes.
• Use the shipment date, not the sale date, for accuracy in customs records.
• Include complete product, buyer, seller, and shipping information, ensuring every field is accurate. Proper completion reduces the risk of customs delays, fines, or shipment rejection.

Step 4: Review and verify

Double-check all the information before sending. Confirm that product descriptions match the shipment, prices are correct, HS codes are accurate, and all regulatory requirements are met.

Accurate invoices protect you from penalties and help customs officials assess duties correctly.

Step 5: Create copies

Keep multiple copies of the commercial invoice for your records and provide originals with your shipment. Having backups ensures you have documentation in case of disputes, customs inquiries, or accounting reviews.

Commercial invoice vs regular invoice

The main difference between commercial invoices and regular invoices is their purpose and the information you need to include. Knowing when to use each helps you avoid shipping delays and compliance issues. US Customs and Border Protection works with 22 other agencies to process imports.

Commercial invoices

Commercial invoices are specifically designed for international shipments and customs processing. They provide customs authorities with all the information needed to calculate duties, taxes, and compliance requirements. Key features include:

• Use for international shipping and customs clearance: Required by customs for every shipment crossing borders.
• Detailed product descriptions: Include HS codes, country of origin, and precise item specifications.
• Official customs document: Serves as proof of sale for both the buyer and customs authorities.
• Mandatory for all international shipments: Helps prevent shipment delays and ensures legal compliance.

Regular invoices

Regular invoices are primarily used for domestic transactions and internal business records. They focus on payment collection rather than regulatory compliance. Key features include:

• Use for domestic sales and payment requests: Acts as a record of the transaction between buyer and seller.
• Basic product details and pricing: Provides enough information for billing and accounting purposes.
• Business transaction record: Serves as proof of sale within the company or for clients.
• Limited regulatory requirements: Does not need HS codes, country of origin, or customs declarations.

Key differences in requirements

When preparing invoices, it’s important to know what each type must include:

• Commercial invoices: Must have Harmonized System (HS) classification codes, country of origin, and specific customs declarations.
• Regular invoices: Focus on payment terms, tax information, and standard transaction details for internal or local use.

Using the correct invoice type ensures compliance with US Customs and Border Protection (CBP) and other regulatory agencies, reduces shipping delays, and protects your business from penalties.

Managing international sales with Xero

When you expand into international markets, you need the right documentation and financial management. Commercial invoices are just one part of managing your international sales.

Xero helps streamline international business operations:

• Create professional invoices that meet international standards
• Track multi-currency transactions automatically
• Manage cash flow across different markets
• Generate reports for tax compliance in multiple jurisdictions

Ready to grow your international business? Xero accounting platform gives you the tools to manage global sales, track international payments and stay compliant in every market. Try Xero for free to see how easy international business management can be.

FAQs on commercial invoices

Find answers to common questions about creating and using commercial invoices for international shipping below.

What is the difference between invoice and commercial invoice?

You use a commercial invoice for international shipping and customs clearance. You use a regular invoice for domestic sales and payment collection.

Who gives the commercial invoice?

You, as the seller or exporter, create and provide the commercial invoice to the buyer and shipping carrier for customs processing.

Can I make my own commercial invoice?

Yes, you can create your own commercial invoice using templates from shipping carriers, accounting software and government resources, as long as you include all required information.

Do I need special software for commercial invoices?

While not required, Xero accounting software can help you make sure your commercial invoices include all necessary fields and maintain proper records for tax compliance.

What happens if my commercial invoice has errors?

Accurate commercial invoices help you avoid customs delays, extra fees and shipment rejection. Always check all information before shipping.