Receipt
Definition
A receipt is a document that confirms payment has been received. It's issued after a client pays an invoice and serves as proof of payment for both the freelancer and the client.
Detailed Explanation
Receipts are distinct from invoices — an invoice asks for payment, a receipt confirms it happened. Every receipt should include: receipt number and date, the linked invoice number, amount paid and payment method, your business details, and client details. Receipts are critical for tax documentation. Digital copies of receipts are accepted by the IRS, HMRC, ATO, and most tax authorities worldwide, provided they are legible and contain all required information. AI bookkeeping tools can generate receipts in one click from paid invoices — all payment details auto-filled from the original invoice.
Freelancer Example
A freelance photographer receives a $1,200 payment from a wedding client via bank transfer. They issue a receipt confirming the payment was received for 'Wedding photography — June 14, 2026,' linking it to the original invoice. Both parties keep a copy for their records.