Why do you issue proforma invoices?

From time to time we get the question why we issue proforma invoices, and whether people can get a "real" invoice, we'll go over here, why we issue such invoices.

Why do you issue the proforma invoice?

Since we're a service company with prepaid services, it means every day, we issue invoices for orders and renewal of services, some which might never actually be renewed.

Every time we issue an invoice this is done as a proforma invoice, to prevent that we have to do accounting for services that ain't renewed, since we haven't generated an actual invoice prior to payment we don't have to deal with accounting for a given service until it's paid, additionally we don't have to do a credit note whenever people don't pay their invoices, and we don't have to pay any VAT on unpaid services either. Greatly simplifying our lives.

For most people, hosting is a product where you don't put in a cancellation, but simply just ignore paying outstanding invoices, as a result of that, it can result in a lot of additional workload (which in turn wastes our time, and costs us money) - using proforma invoices solves this problem.

When you pay the invoice, you instantly get a commercial invoice issued for the payment you've made, which can be used for accounting purposes.

Isn't it illegal to issue proforma invoices since they're not valid?

No, issuing proforma invoices is completely legal, since the proforma invoice has no value from a commercial and accounting perspective, it's no different than a "quote" or an "offer". You as a customer can decide to not pay the proforma invoice generated.

Since all services are prepaid, if you decide to not pay the proforma invoice, we'll simply suspend and terminate the account, since you've decided to not renew your services.

Since proforma invoices are non-binding, you can't have contracts?

It's correct that proforma invoices by nature are non-binding. But in a scenario where you as a customer e.g. lease a server from us on a 12-month contract with quarterly payments, failure to pay the given proforma invoice, will, in turn break the given written agreement in place for the service rendered, regardless of the non-binding nature of the proforma invoice. They're after all, two separate things.

Can I get a normal invoice prior to paying the invoice?

The short answer: No, in most cases you can't

Our billing system does not support issuing proforma invoices for some customers and not others. In the rare case that your company is absolutely unable to pay a proforma invoice due to internal limitations, then we cannot offer our services to you, and you're free to find another supplier. We service anything from private people, SMB, large enterprises and government bodies, they've all been able to pay their proforma invoices.

You can consider the proforma invoice in a similar fashion to if you go into a store and buy a product, since you first get the invoice after doing your payment.