Under-invoicing definition

Under-invoicing

Stating a price below the true value of goods, so that value is retained abroad or duty and export restrictions are reduced.

reviewed

2026-08-20

Cite this page

APA 7

Sanctions Evasion Reference. (2026, August 20). Under-invoicing. https://sanctionsevasion.org/reference/glossary/under-invoicing/

Chicago

Sanctions Evasion Reference. “Under-invoicing.” Last reviewed August 20, 2026. https://sanctionsevasion.org/reference/glossary/under-invoicing/.

BibTeX

@misc{ser-reference-glossary-under-invoicing,
  author = {{Sanctions Evasion Reference}},
  title  = {Under-invoicing},
  year   = {2026},
  note   = {Last reviewed 2026-08-20},
  url    = {https://sanctionsevasion.org/reference/glossary/under-invoicing/}
}

The date is when this page was last reviewed, not when it was first published.

Under-invoicing is the mirror of over-invoicing and moves value the other way, leaving the difference offshore with the buyer. In a sanctions context it also has a second use: a shipment declared at low value attracts less customs attention and may fall below thresholds that would trigger additional checks.

Both directions produce the same statistical signature — a divergence between what the exporting country and the importing country report for the same trade flow.

Where this term is used

What is cargo origin blending? — Mixing, decanting or re-documenting a commodity in transit so that restricted cargo is no longer traceable to its origin and arrives certified as coming from somewhere else.
What is HS code misclassification? — Declaring goods under a Harmonised System commodity code that does not describe them, so that they attract the wrong duty, escape a licence requirement, or disappear from the statistics that would show them.
What is trade misinvoicing? — Trade misinvoicing is misstating the price, quantity or description of goods on trade documents, so that value moves across a border in a direction and an amount the paperwork does not admit.

Related terms

Over-invoicing — Stating a price above the true value of goods on an invoice, so that the importer transfers more value to the exporter than the trade justifies.
Trade misinvoicing — Deliberately misstating the price, quantity or description of goods on trade documents so that the value recorded differs from the value actually exchanged.
Mirror statistics — Comparing what one country reports exporting to a partner with what the partner reports importing from it, treating persistent gaps as evidence of misreporting.

Where this term is used

Related terms

Sources