Customs, tax & compliance CI

Commercial invoice

The final sales document issued by the seller after shipment, stating the description of goods, HS code, quantity, unit and total price, Incoterm, payment terms, origin and the parties’ details. It is the basis for customs valuation, duties and letter-of-credit payment; under a credit the description of goods must match the credit exactly. Unlike a proforma invoice, it records the actual sale and the amount due.

Related terms

Proforma invoice PI

A preliminary invoice issued by the seller before shipment, listing the product, quantity, unit price, Incoterm, payment terms, delivery time and bank details. Buyers use it to open a letter of credit, pay an advance or apply for import licences or foreign-exchange allocation. It is not a tax invoice; once countersigned by the buyer it can serve as the contract in simple deals, but larger transactions deserve a full sales contract.

Packing list P/L

A document listing the contents of every package in a shipment – bag, pallet, drum, coil or container – with quantities, net and gross weights, dimensions, lot or batch numbers and container and seal numbers. It contains no prices. It is used for customs examination, warehouse receipt, damage and shortage checks and in letter-of-credit document sets; weights must be consistent with the invoice and bill of lading.

Customs valuation (transaction value)

The value on which duty is calculated. Under the WTO Customs Valuation Agreement the primary basis is the price actually paid or payable (transaction value). Most countries, including the EU and Türkiye, add freight and insurance up to the point of entry (CIF basis), while some, such as the USA, use a FOB basis. Commissions, royalties and buyer-supplied assists such as moulds may also be added. If under-invoicing between related parties is found, customs applies other methods and penalties.

Explained in the trade handbook

Trade handbook