Etsy Invoice: Custom Orders, Receipts and Sales Tax
Etsy invoice guide: when Etsy receipts are enough, how to bill custom and wholesale orders the right way, how sales tax collected by Etsy works, plus a sample.
Quick answer: An Etsy invoice is usually not needed, because Etsy issues an order receipt for every checkout and collects US sales tax for you. Sellers create their own invoice only for off-Etsy sales or when a business buyer needs a paid invoice with your business details. Custom orders arranged on Etsy should be billed through a reserved listing, not an outside invoice.
Etsy sellers often ask how to send an invoice for a custom order, a bulk order or a corporate gift. The answer depends on where the sale started. This guide explains what Etsy already provides, when you should create your own invoice, how Etsy's sales tax collection affects your paperwork, and how to stay inside Etsy's rules. It ends with a sample paid invoice and a checklist.
What is an Etsy invoice?
Strictly, Etsy does not issue invoices to buyers before payment. Buyers pay at checkout and receive an order receipt, which shows the items, quantities, item price, shipping, sales tax collected, discounts and total. Sellers see the same order in Shop Manager and can print a receipt or packing slip.
So when people search for an Etsy invoice, they usually mean one of three things:
- A printable receipt for an Etsy purchase (buyer or seller side)
- A way to charge a buyer for a custom or special order
- A formal invoice in the seller's business name for a business customer, wholesale account or off-Etsy sale
If you are unsure how receipts and invoices differ, our explainer on invoice vs receipt covers the basics, and our payment receipt template shows what a receipt includes.
How do custom orders work on Etsy?
For a custom order agreed in Etsy messages, the compliant way to bill is a custom (reserved) listing:
- Agree the details in Etsy Messages: design, size, materials, price, shipping and timing.
- Create a listing for that buyer with the agreed price and description, or use Etsy's custom order request tool where it is enabled for your shop.
- Send the buyer the link and let them check out normally.
- For large jobs, split it into a deposit listing and a balance listing, both paid through Etsy.
Etsy's House Rules prohibit fee avoidance, such as asking a buyer you met on Etsy to pay by PayPal, bank transfer or an outside invoice to skip Etsy fees. Breaking that rule can get your shop restricted, and buyers lose purchase protection. If the buyer found you on Etsy, keep the payment on Etsy.
What fees and tax show up on an Etsy order?
Knowing the fees helps you price custom work and reconcile your books. As of October 2026, the most widely published US fee schedule is below; confirm the current figures on Etsy's Fees and Payments Policy, since they change and differ by country.
| Item | Typical US amount | Who pays |
|---|---|---|
| Listing fee | $0.20 per listing (and per renewal, including auto-renew on each sale) | Seller |
| Transaction fee | 6.5% of the item price plus shipping and gift wrap | Seller |
| Payment processing (US) | About 3% + $0.25 per order | Seller |
| Offsite Ads | 12% to 15% on sales attributed to the ads | Seller |
| Sales tax | Calculated by buyer's location | Buyer pays, Etsy collects and remits |
Because Etsy is the marketplace facilitator for US sales tax, you should not add your own tax line to an Etsy order. Etsy also collects VAT or GST on certain orders to buyers in the UK, EU, Australia and other countries, depending on where the buyer is and the order value.
Worked example: what an Etsy custom order nets you
A candle maker sells a custom set of 12 wedding favor candles for $180 plus $15 shipping to a buyer in a state with a 7% combined sales tax rate on goods. Using the fee schedule above (illustrative):
- Buyer pays: $180 + $15 = $195, plus sales tax of about $195 × 0.07 = $13.65 (Etsy calculates the exact amount, and whether shipping is taxed depends on the state). Buyer total: $208.65.
- Listing fee: $0.20
- Transaction fee: 6.5% × $195 = $12.68
- Processing: 3% × $208.65 + $0.25 = $6.26 + $0.25 = $6.51
- Total Etsy fees: $0.20 + $12.68 + $6.51 = $19.39
- Seller receives about $195 − $19.39 = $175.61 before materials and postage. The $13.65 tax goes to the state through Etsy.
That roughly 10% fee load is why sellers are tempted to invoice outside Etsy. Price it into the custom quote instead. Starting a candle shop? See how to start a candle business, and for selling beyond marketplaces, how to start an online store.
When should an Etsy seller create their own invoice?
| Situation | Use Etsy receipt? | Create your own invoice? |
|---|---|---|
| Normal Etsy order | Yes | No |
| Custom order arranged in Etsy messages | Yes (via reserved listing) | No, do not bill outside Etsy |
| Business buyer needs your business name and tax number on a document | Yes | Optional: a paid invoice referencing the Etsy order |
| Craft fair, market or in-person sale | No | Yes, or a receipt |
| Wholesale account found outside Etsy | No | Yes, with terms and resale certificate |
| Sales on your own website | No | Yes, through your store or invoice tool |
For off-Etsy sales, you are responsible for sales tax yourself. Check whether you need a seller's permit, see sales tax by state, and accept resale exemption certificates from wholesale buyers.
Sample paid invoice for an Etsy business buyer
A company bought 40 engraved keychains through Etsy as client gifts, and its accounts team asked for an invoice with the seller's business details. The invoice simply documents the completed Etsy order.
From: Copper Fern Studio LLC, 88 Birch Lane, Asheville, NC 28801.
To: Lumen Analytics Inc., attn. Accounts Payable.
Invoice #: CF-2026-118. Date: October 29, 2026. Etsy order #: 3456789012. Status: PAID via Etsy checkout on October 22, 2026.
| Description | Qty | Unit price | Amount |
|---|---|---|---|
| Engraved brass keychain, custom logo | 40 | $14.00 | $560.00 |
| Gift box upgrade | 40 | $2.50 | $100.00 |
| Shipping, UPS Ground | 1 | $18.00 | $18.00 |
| Subtotal | $678.00 | ||
| Sales tax collected and remitted by Etsy | $47.46 | ||
| Total paid | $725.46 | ||
| Balance due | $0.00 | ||
The tax figure must match the Etsy receipt exactly (here $678 × 7% = $47.46). Add a note such as Paid in full through Etsy. Sales tax collected by Etsy as marketplace facilitator. Our guide to the paid invoice template shows other wording options.
How to create an invoice for an Etsy sale
- Open the order in Shop Manager and note the order number, date, items, shipping and tax.
- Open a free invoice generator and add your business name, logo and address.
- Give it your own invoice number (the invoice number generator helps keep a series), and reference the Etsy order number.
- Enter line items and amounts exactly as on the Etsy receipt.
- Add the tax line with a note that Etsy collected it.
- Mark it paid, with a zero balance due, and download the PDF.
- Send it to the buyer through Etsy Messages and save a copy with your records.
How should Etsy sellers keep records for taxes?
Etsy receipts and invoices are only part of the paper trail. For your tax return, what matters is reconciling gross sales, fees, refunds and payouts. A simple monthly routine works for most small shops:
- Download the monthly statement from Shop Manager (under Finances). It summarizes sales, fees, taxes and deposits.
- Export the orders CSV for the same month so you have order-level detail.
- Record gross sales (item price plus shipping charged), not just the deposit you received.
- Record fees as expenses: listing, transaction, processing, ads and any shipping labels bought through Etsy.
- Exclude sales tax Etsy collected from your income, since it was never yours, but keep a note of it to explain any differences against the 1099-K.
- Match deposits to your business bank account, which keeps shop money separate from personal funds.
- Add off-Etsy sales from your own invoices and receipts, plus any sales tax you collected yourself.
Here is how the earlier custom candle order looks in the books: gross sales $195.00, Etsy fees $19.39 as an expense, sales tax $13.65 excluded from income, and a deposit of about $175.61. If your 1099-K shows a higher gross figure because it includes tax or shipping, your records explain the difference. Our guide to tracking business expenses suggests a simple system, and if you are not sure how much to put aside each month, see how much to set aside for taxes.
Many Etsy sellers start as sole proprietors and later form an LLC. If you change structure, update your Etsy shop's tax information and bank details so payouts, 1099-K reporting and your invoices all use the same business name.
Common Etsy invoicing mistakes
- Taking payment off Etsy for an Etsy buyer. It breaks the fee avoidance rule and removes buyer protection.
- Adding sales tax yourself on Etsy orders. Etsy already collects it, so you would double-charge.
- Invoices that do not match the receipt. Different totals confuse the buyer's accounts team.
- Forgetting off-Etsy tax duties. Craft fair and website sales are your own responsibility.
- Ignoring fees in custom quotes. Price custom work so you still make your margin after roughly 10% in fees.
- Poor records. Download monthly statements so you can reconcile sales, fees and 1099-K figures. See the 1099-K threshold.
Etsy invoice: the short version
For Etsy checkout orders, the Etsy receipt is the record, and Etsy handles US sales tax. Bill custom orders through reserved listings, and create your own Etsy invoice only as a paid document for business buyers or for sales that genuinely happen off Etsy. When you need one, our free invoice generator is free, needs no sign-up, and downloads a PDF built in your browser. This is general information, not tax or legal advice.
Frequently asked questions
Does Etsy send invoices to buyers?
Etsy sends buyers an order receipt by email and keeps it in their Purchases area, showing items, shipping, tax and the total paid. That receipt works for most consumer purchases. Etsy does not offer sellers a separate invoicing tool for billing customers before payment. For a custom order, you create a reserved listing and the buyer pays at checkout like any other Etsy purchase.
Can I send an Etsy buyer a PayPal or bank invoice instead of using checkout?
Not for a sale that started on Etsy. Etsy's rules prohibit fee avoidance, which includes moving a buyer you met through Etsy to an outside payment to skip Etsy's fees. Doing it can lead to account restrictions or suspension, and the buyer loses Etsy's purchase protection. Use a custom or reserved listing for anything arranged through Etsy messages.
Do I need to charge sales tax on Etsy orders?
For orders placed through Etsy checkout, Etsy calculates, collects and remits sales tax in US states that have marketplace facilitator laws, which covers every state with a statewide sales tax. You do not add tax yourself. Orders you sell through your own website, craft fairs or wholesale channels follow your own state registration and collection obligations.
How do I print an invoice for an Etsy order?
Sellers can open the order in Shop Manager under Orders and Shipping and print the order receipt or packing slip, which lists items, prices, shipping and the buyer's address. Buyers can view and print their receipt from Purchases. If a business buyer needs a document with your business name, address or tax number, you can prepare a matching invoice marked as paid.
Should an Etsy invoice for a business buyer be marked paid?
Yes, if the buyer already paid through Etsy checkout. Mark it Paid, reference the Etsy order number and payment date, and show the amounts exactly as charged, including any tax Etsy collected. A paid invoice is effectively a detailed receipt for the buyer's records. Never request a second payment on that document, because the order is already settled through Etsy.
Do Etsy sellers get a 1099-K?
Etsy issues Form 1099-K to US sellers whose payments reach the federal reporting threshold, and some states have lower thresholds of their own. Whether or not you receive one, all Etsy sales income is reportable. Keep your Etsy monthly statements and payment account reports, which break out sales, fees, refunds and tax collected, to reconcile with your tax return.
How do I invoice wholesale customers I found through Etsy?
If the wholesale relationship began on Etsy, keep those sales on Etsy through custom listings to stay within the fee avoidance rules. Wholesale buyers who found you independently, for example at a trade show or through your own website, can be invoiced directly with your own invoice, payment terms and resale certificate details for sales tax exemption.
What is the difference between an Etsy receipt and an invoice?
An Etsy receipt confirms a payment that has already happened through Etsy checkout. An invoice requests payment, or documents a sale in your own business's name with your invoice number and terms. For Etsy orders, the receipt is the primary record. Invoices are mainly for off-Etsy sales or for buyers who need a document showing your business details.
Invoice Creator Editorial Team
Guides on invoicing, cash flow and small-business finance from Invoice Creator, operated by Next Software Development Company. Content is reviewed for accuracy against the fields our own invoice generator produces.
Try the invoice generator