BillingReceipts

How to invoice for a deposit

A deposit secures the job and covers early costs. Invoice it clearly, then show it as a credit on the final invoice so the balance due is obvious.

The deposit invoice

Create an invoice for the deposit amount. Describe it, for example: 30 percent deposit for kitchen remodel. Note that it is refundable or not according to your agreement.

On the final invoice

List the full price of the work, then show the deposit already received as a deduction. The total due is what remains.

Get it in writing

Put the deposit amount, what it covers and the refund terms in your contract or quote.

Questions

How much deposit should I ask for?

It varies by industry. Between 25 and 50 percent is common for larger jobs. For small jobs a flat amount may be enough.

Do I charge tax on the deposit?

Rules differ. Ask an accountant how your area treats deposits and when tax is due.

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General information, not legal, tax, or accounting advice. Rules vary by place.