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What Is a Service Receipt?

By C. Mitchell
Updated May 16, 2024
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A service receipt is a receipt that a contractor, laborer, or other technician issues to document services rendered. In most respects, a service receipt is the same as a sales receipt, except that it documents services given, not goods sold. A receipt for a haircut, for instance, is a basic service receipt. More complex service receipts document car services performed, painting jobs completed, or freight and delivery surcharges. The purpose of a service receipt is both to prove that something was done, and to show that that something was paid for.

Service receipts come in a variety of formats. Some are issued just like sales receipts, often from a cash register. Simple services rendered in stores or through specialty retailers often take this form. Other service receipts are written out more like invoices. Contractors who are billing clients for a certain number of hours of service, for instance, or vendors who installed a certain list of parts, may write out their own service receipt.

There is no single right or wrong way to go about writing a service receipt. Certain key elements are usually required, however. Most of the time, both the seller and the buyer must be named. The receipt must usually be dated, and the services rendered should be described in some detail.

By the time a service receipt is written out and issued, a service has already been performed and paid for. Still, there are some important reasons why a person might want to keep a service receipt. Should something fall short of expectations, for instance, a service receipt serves as documentation of the services that should have been performed. Service receipts also prove that services were rendered, which can be important if there is ever a dispute about what was done, or if a contractor ever claims that services were not paid in full.

It is usually also a good idea to keep service receipts for any services that were rendered in the course of doing business. If an individual employee paid for business services himself, he can often seek reimbursement from the corporation by presenting a service receipt. Business owners can also use service receipts to prove business-related expenses, which can often times be written off as tax deductions.

When used for tax purposes, service receipts must usually be preserved for a period of several years. If a taxation authority audits a small business owner, that owner will need to have the receipts on hand in order to justify each and every deduction — even if years have passed since the time of the transaction. Small businesses with a lot of deductions are often targeted for audits because of how easy it is to fabricate services rendered. Keeping careful track of all service receipts, as well as other types of receipts used for business-related deductions, can keep the auditors at bay.

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