A Bill of Sale is a legal document that details the private sale of personal property between a buyer and a seller. It records the ownership transfer and outlines key information such as the date, price, and description of the sold item. 

As a seller, you’re usually the one to create a Bill of Sale. Both you and the buyer should retain a copy of the document. 

A Bill of Sale is also known as a:

• Proof of purchase
• Sales receipt

An as-is Bill of Sale determines that a buyer accepts purchasing an item in its current condition despite any flaws. 

Without an as-is clause, the seller could be responsible if the buyer discovers something wrong with the item after the sale. Additionally, sellers cannot intentionally hide known defects of the item they’re selling. So, having an as-is clause protects you, the seller, when the buyer agrees to purchase the item in its current state. 

If there is any dispute regarding the item's condition in the future, the as-is Bill of Sale will help prove that the buyer knowingly purchased it with its flaws or need for repair. 

LawDepot’s template automatically includes an as-is clause to help protect your sale.

A Bill of Sale is used when selling personal property in a private sale and should be completed once you receive the full payment. 

You should also create a Bill of Sale when giving certain items as gifts. For example, if you’re gifting your motorcycle to your nephew, you should still create a Bill of Sale for insurance and registration purposes. In these instances, you can set the sale prices as ₹1.00. 

A Bill of Sale is not suitable for selling a service. If you’re providing services to a client, you’ll need to use a Service Agreement, such as a Cleaning Services Agreement or a Catering Contract, to create the terms and conditions between you and a client. Then, follow up with an invoice for payment where needed.

LawDepot’s user-friendly template allows you to create a Bill of Sale when transferring the ownership of personal property. Items you’re selling can include:

• Motor vehicles (e.g., cars, trucks, vans, and mopeds)
• Trailers and RVs
• Watercraft (e.g., motorboats, sailboats, and jet skis) 
• Animals and livestock (e.g., horses, cattle, and dogs)
• Personal items (e.g., phones, clothing, and jewellery)
• Household items (e.g., furniture and kitchen appliances)
• Equipment (e.g., tools, computers)
• Mobile or manufactured homes
• Firearms
• Artwork

It’s important to note that a Bill of Sale cannot be used to purchase real estate, a business, or company shares.

You should use a Bill of Sale as it provides evidence of a transaction. Though verbal agreements can be binding under the India Code, having a written record can protect both you and the buyer. 

This document can assist in ensuring that there are no misunderstandings or future issues regarding the sale. If a dispute occurs, you can prove the price, condition of the item, and the buyer’s acceptance of those terms using your Bill of Sale. 

In addition, a Bill of Sale proves the buyer paid for the item and is now the owner. Depending on the property, the buyer may need to obtain the title to the property or confirm that the item is legally in their possession.

Lastly, you or the buyer may also need a Bill of Sale for future tax purposes. 

LawDepot’s questionnaire lets you create a Bill of Sale that you can download as a PDF to print and sign. First, select the type of item you’re selling. This can be a motor vehicle, trailer, watercraft, animal, or other. Then, complete your document with the following steps:

1. Select the location of the property

Our template is customisable for each state and territory. Select where the item is being sold to create a valid Bill of Sale for your jurisdiction.

A Bill of Sale can also be made under the state where you or the seller reside, but only if there are no overriding tax or environmental restrictions. 

2. Give details of the item being sold

A Bill of Sale must have thorough details about the item being sold. For example, if you’re selling a boat, you must include information like the make, model, and hull identification number (HIN). 

The more information you provide, the better. Adding features about the item will also strengthen the documentation for an as-is Bill of Sale. This can help if there is any issue regarding the condition or features of the item at a later date.

3. Include the seller and buyer details

Next, include the names and addresses of both you and the buyer. If either party is a company, you should include its incorporated name rather than its trade name.

4. Add payment details

Follow with including all the payment details for the sale. This includes:

• Price
• Sales tax
• Payment method (i.e., cash, demand draft, Promissory Note, internet banking, etc.)

If the item being sold has any loans or liens, they must be included in your Bill of Sale. The seller will have to accept responsibility for anything outstanding on that item.

5. Provide final details

You can include any additional clauses that may be necessary for your sale. Even though LawDepot’s template automatically includes an as-is clause, you can specify if there are any other particular repairs or faults to the item to make a stronger agreement. 

Finally, add your signing details. This will include the date of signing if you have one arranged already. You can also include the number of witnesses you’ll have when you sign the document. 

In some jurisdictions, the buyer isn’t required to sign a Bill of Sale. You can check with local requirements or ask a lawyer to see if the buyer must also sign. Alternatively, you can still have them sign for best practice.