[{"data":1,"prerenderedAt":1627},["ShallowReactive",2],{"page-\u002Fwhat-is-a-statement-of-account":3,"related-\u002Fwhat-is-a-statement-of-account":694},{"id":4,"title":5,"author":6,"body":7,"category":680,"date":681,"dek":682,"description":683,"extension":684,"featured":685,"meta":686,"navigation":687,"path":688,"readingTime":689,"seo":690,"sitemap":691,"stem":692,"__hash__":693},"content\u002Fwhat-is-a-statement-of-account.md","What Is a Statement of Account? When to Send One (+ Free Template)","Daniel Reed",{"type":8,"value":9,"toc":663},"minimark",[10,15,24,27,30,34,37,74,86,90,93,98,101,104,107,202,206,209,217,220,335,343,346,350,353,418,425,429,432,435,477,485,489,492,529,532,536,539,567,570,574,582,614,622,625,629,660],[11,12,14],"h2",{"id":13},"the-document-that-chases-five-overdue-invoices-at-once","The document that chases five overdue invoices at once",[16,17,18,19,23],"p",{},"Say a design client has slipped on invoices #1041, #1048, and #1052 over the past four months. You could send three separate payment reminders and hope their bookkeeper connects the dots. Or you could send a single sheet that lists all three, shows the running total they owe, notes what they've already paid, and lands on one clear number at the bottom: ",[20,21,22],"strong",{},"£4,280 outstanding",".",[16,25,26],{},"That single sheet is a statement of account. It isn't a new bill. It's a summary of the account between you and one customer over a period of time, pulling together invoices, payments, credits, and the resulting balance.",[16,28,29],{},"Freelancers and small businesses tend to skip statements entirely, which is a mistake. When a client owes you for multiple jobs, a statement is the fastest way to make the total impossible to ignore, and it saves you from writing five awkward emails.",[11,31,33],{"id":32},"statement-of-account-vs-invoice-receipt-and-reminder","Statement of account vs invoice, receipt, and reminder",[16,35,36],{},"These get muddled constantly, so here's the clean distinction:",[38,39,40,48,59,68],"ul",{},[41,42,43,44,47],"li",{},"An ",[20,45,46],{},"invoice"," requests payment for a specific job or order. It creates a new obligation.",[41,49,50,51,58],{},"A ",[20,52,53],{},[54,55,57],"a",{"href":56},"\u002Fhow-to-write-a-receipt","receipt"," confirms that a payment has been made. It's proof, not a request.",[41,60,50,61,67],{},[20,62,63],{},[54,64,66],{"href":65},"\u002Fpayment-reminder-email-templates","payment reminder"," nudges the client about one overdue invoice.",[41,69,50,70,73],{},[20,71,72],{},"statement of account"," summarizes multiple transactions and shows the net balance owed across an account.",[16,75,76,77,81,82,23],{},"The critical point: a statement does not replace an invoice. Your client still pays against the individual invoice numbers. The statement just gives both sides a shared, reconciled view. If you ever send a statement as though it were a bill in its own right, expect confusion, and in some jurisdictions you can't claim tax on a statement the way you can on a proper ",[54,78,80],{"href":79},"\u002Fwhat-is-a-tax-invoice-australia","tax invoice"," or ",[54,83,85],{"href":84},"\u002Fuk-vat-invoices-explained","VAT invoice",[11,87,89],{"id":88},"the-two-types-open-item-and-balance-forward","The two types: open-item and balance-forward",[16,91,92],{},"Statements come in two formats, and choosing the right one depends on how your client thinks about paying you.",[94,95,97],"h3",{"id":96},"open-item-statement","Open-item statement",[16,99,100],{},"An open-item statement lists only the invoices that are still unpaid. Each line is a live item waiting to be settled. Once an invoice is paid in full, it drops off the next statement.",[16,102,103],{},"This is the format most freelancers and service businesses should use. Clients pay invoice by invoice, so showing them exactly which invoices are open, with dates and amounts, tells them precisely what to action.",[16,105,106],{},"Example of an open-item statement:",[108,109,110,132],"table",{},[111,112,113],"thead",{},[114,115,116,120,123,126,129],"tr",{},[117,118,119],"th",{},"Date",[117,121,122],{},"Invoice #",[117,124,125],{},"Description",[117,127,128],{},"Amount",[117,130,131],{},"Balance",[133,134,135,152,169,185],"tbody",{},[114,136,137,141,144,147,150],{},[138,139,140],"td",{},"12 Mar",[138,142,143],{},"1041",[138,145,146],{},"Brand guidelines",[138,148,149],{},"£1,200",[138,151,149],{},[114,153,154,157,160,163,166],{},[138,155,156],{},"09 Apr",[138,158,159],{},"1048",[138,161,162],{},"Website mockups",[138,164,165],{},"£1,880",[138,167,168],{},"£3,080",[114,170,171,174,177,180,182],{},[138,172,173],{},"21 May",[138,175,176],{},"1052",[138,178,179],{},"Social templates",[138,181,149],{},[138,183,184],{},"£4,280",[114,186,187,189,191,196,198],{},[138,188],{},[138,190],{},[138,192,193],{},[20,194,195],{},"Total due",[138,197],{},[138,199,200],{},[20,201,184],{},[94,203,205],{"id":204},"balance-forward-statement","Balance-forward statement",[16,207,208],{},"A balance-forward statement shows an opening balance carried from the previous period, then every transaction during the current period (new invoices, payments received, credit notes), and closes with a new balance. It's the format you see on a credit card statement or a utility bill.",[16,210,211,212,216],{},"This suits ongoing accounts with lots of activity, where a client is constantly ordering and paying, and neither side wants to track each invoice individually. If you run a ",[54,213,215],{"href":214},"\u002Frecurring-and-retainer-invoices","retainer arrangement"," or supply a client weekly, balance-forward can be cleaner.",[16,218,219],{},"Example of a balance-forward statement for June:",[108,221,222,238],{},[111,223,224],{},[114,225,226,228,230,233,236],{},[117,227,119],{},[117,229,125],{},[117,231,232],{},"Charges",[117,234,235],{},"Payments",[117,237,131],{},[133,239,240,255,270,285,301,317],{},[114,241,242,245,248,250,252],{},[138,243,244],{},"01 Jun",[138,246,247],{},"Opening balance",[138,249],{},[138,251],{},[138,253,254],{},"$2,400",[114,256,257,260,263,265,267],{},[138,258,259],{},"05 Jun",[138,261,262],{},"Payment received (inv 1102)",[138,264],{},[138,266,254],{},[138,268,269],{},"$0",[114,271,272,275,278,281,283],{},[138,273,274],{},"08 Jun",[138,276,277],{},"Invoice 1115",[138,279,280],{},"$900",[138,282],{},[138,284,280],{},[114,286,287,290,293,296,298],{},[138,288,289],{},"19 Jun",[138,291,292],{},"Invoice 1121",[138,294,295],{},"$1,350",[138,297],{},[138,299,300],{},"$2,250",[114,302,303,306,309,311,314],{},[138,304,305],{},"26 Jun",[138,307,308],{},"Credit note CN-004",[138,310],{},[138,312,313],{},"$150",[138,315,316],{},"$2,100",[114,318,319,322,327,329,331],{},[138,320,321],{},"30 Jun",[138,323,324],{},[20,325,326],{},"Closing balance",[138,328],{},[138,330],{},[138,332,333],{},[20,334,316],{},[16,336,337,338,342],{},"Notice how a ",[54,339,341],{"href":340},"\u002Fwhat-is-a-credit-note","credit note"," reduces the balance without being a cash payment. Balance-forward statements handle that neatly because they track movement, not just open bills.",[16,344,345],{},"If you're unsure which to use, default to open-item. It answers the only question that matters to a slow payer: which invoices do I need to pay, and how much.",[11,347,349],{"id":348},"what-goes-on-a-statement-of-account","What goes on a statement of account",[16,351,352],{},"A usable statement includes:",[38,354,355,361,367,377,383,389,395,401,407],{},[41,356,357,360],{},[20,358,359],{},"Your business name, address, and contact details",", plus your tax or company number if you have one.",[41,362,363,366],{},[20,364,365],{},"The client's name and address",", exactly as on the invoices.",[41,368,369,372,373,376],{},[20,370,371],{},"A statement date"," and, for balance-forward, the ",[20,374,375],{},"period covered"," (e.g. \"1–30 June 2026\").",[41,378,379,382],{},[20,380,381],{},"A \"statement number\""," is optional but helps if you send them regularly.",[41,384,385,388],{},[20,386,387],{},"Line items",": date, invoice number, short description, amount, and running balance.",[41,390,391,394],{},[20,392,393],{},"Payments and credits"," applied during the period (essential for balance-forward, useful for open-item so the client sees you've recorded their payments).",[41,396,397,400],{},[20,398,399],{},"The total amount outstanding",", prominent and unambiguous.",[41,402,403,406],{},[20,404,405],{},"Ageing",", if you want to apply gentle pressure (more on this below).",[41,408,409,412,413,417],{},[20,410,411],{},"Payment instructions",": bank details, accepted ",[54,414,416],{"href":415},"\u002Fbest-payment-methods-for-freelancers","payment methods",", and a due date or \"please settle within 7 days.\"",[16,419,420,421],{},"Add a short line making clear it's a summary, not a new charge: ",[422,423,424],"em",{},"\"This is a statement of your account. Please pay against the individual invoice numbers listed above.\"",[11,426,428],{"id":427},"ageing-the-quiet-pressure-tactic","Ageing: the quiet pressure tactic",[16,430,431],{},"An ageing statement (sometimes \"aged debtors\" or \"aged receivables\") groups the outstanding balance by how overdue each amount is. It's one of the most persuasive things you can put in front of a client, because it shows exactly how long they've been holding your money.",[16,433,434],{},"A typical ageing summary sits at the foot of the statement:",[108,436,437,459],{},[111,438,439],{},[114,440,441,444,447,450,453,456],{},[117,442,443],{},"Current",[117,445,446],{},"1–30 days",[117,448,449],{},"31–60 days",[117,451,452],{},"61–90 days",[117,454,455],{},"90+ days",[117,457,458],{},"Total",[133,460,461],{},[114,462,463,465,467,469,472,474],{},[138,464,280],{},[138,466,295],{},[138,468,269],{},[138,470,471],{},"$2,030",[138,473,269],{},[138,475,476],{},"$4,280",[16,478,479,480,484],{},"Seeing $2,030 sitting in the \"61–90 days\" column is far harder to rationalize than a single overdue line buried in an email thread. If your invoices carry ",[54,481,483],{"href":482},"\u002Fhow-to-charge-late-fees-on-overdue-invoices","late fees",", the ageing columns also make it obvious which balances have started accruing them.",[11,486,488],{"id":487},"when-to-send-one","When to send one",[16,490,491],{},"There's no single correct cadence, but these are the moments a statement earns its keep:",[493,494,495,501,507,513,519],"ol",{},[41,496,497,500],{},[20,498,499],{},"Monthly, for any client with more than one open invoice."," Send it on the same date each month (say, the 1st) so it becomes a predictable prompt for their accounts payable.",[41,502,503,506],{},[20,504,505],{},"When invoices are stacking up unpaid."," Two or three overdue invoices are the classic trigger. One statement beats three reminders.",[41,508,509,512],{},[20,510,511],{},"At the end of a project or quarter."," A closing statement confirms everything is settled, or flags what isn't, before you both move on.",[41,514,515,518],{},[20,516,517],{},"When a client's bookkeeper asks for one."," Larger clients often request a statement to reconcile their own records before a payment run. Sending it proactively can get you into that payment run sooner.",[41,520,521,524,525,23],{},[20,522,523],{},"Before escalating."," A formal statement showing a large aged balance is a reasonable last step before you consider the harder options in ",[54,526,528],{"href":527},"\u002Fwhat-to-do-when-a-client-wont-pay","what to do when a client won't pay",[16,530,531],{},"For a client who always pays each invoice on time, you don't need statements at all. They're a tool for accounts with activity or friction, not routine paperwork for everyone.",[11,533,535],{"id":534},"a-sample-covering-email","A sample covering email",[16,537,538],{},"Attach the statement as a PDF and keep the message short:",[540,541,542,552,555,558,561,564],"blockquote",{},[16,543,544],{},[20,545,546,547,551],{},"Subject: Statement of account — ",[548,549,550],"span",{},"Your Business"," — as of 15 July",[16,553,554],{},"Hi Priya,",[16,556,557],{},"Attached is your current statement of account. It summarizes three invoices that are still open, totaling £4,280. Invoice #1041 (£1,200) is now over 90 days past due.",[16,559,560],{},"Could you let me know when I can expect payment, or which of these are queued in your next run? Bank details are on the statement, and payment should be made against each invoice number.",[16,562,563],{},"Happy to resend any of the original invoices if that helps your records.",[16,565,566],{},"Thanks,\nDaniel",[16,568,569],{},"Factual, specific, no apology for asking. Naming the oldest invoice and its age does most of the work.",[11,571,573],{"id":572},"building-your-template","Building your template",[16,575,576,577,581],{},"You don't need special software. A statement is a table, and you can build a reusable version in ",[54,578,580],{"href":579},"\u002Fhow-to-make-an-invoice-in-excel-word-google-docs","Excel, Word, or Google Docs"," in about twenty minutes. Structure it like this:",[38,583,584,590,596,602,608],{},[41,585,586,589],{},[20,587,588],{},"Header block",": your details left, client details right, statement date and period below.",[41,591,592,595],{},[20,593,594],{},"Body table",": Date | Invoice # | Description | Charges | Payments | Balance.",[41,597,598,601],{},[20,599,600],{},"Totals block",": total outstanding, in bold, larger font.",[41,603,604,607],{},[20,605,606],{},"Ageing table",": the five columns shown above.",[41,609,610,613],{},[20,611,612],{},"Footer",": payment instructions and the \"this is a summary\" note.",[16,615,616,617,621],{},"In a spreadsheet, make the Balance column a running formula (",[618,619,620],"code",{},"=previous balance + charges − payments",") and let the total pull from it automatically. That way you update one row and the numbers reconcile themselves, which removes the most common statement error: a total that doesn't match the lines above it.",[16,623,624],{},"Most invoicing apps generate statements automatically from your unpaid invoices, so if you already use one, check the reports or customer section before building anything by hand.",[11,626,628],{"id":627},"common-slip-ups","Common slip-ups",[38,630,631,637,643,649],{},[41,632,633,636],{},[20,634,635],{},"Balances that don't match the client's records."," If they've paid an invoice you haven't marked as received, your statement will overstate the debt and undermine your credibility. Reconcile before sending.",[41,638,639,642],{},[20,640,641],{},"Treating the statement as an invoice."," It carries no new tax point and shouldn't be the document a client pays \"against\" in the abstract. Point them to the underlying invoice numbers.",[41,644,645,648],{},[20,646,647],{},"Missing invoice numbers."," Without them, the client's bookkeeper can't match your statement to their ledger, and matching is the whole point.",[41,650,651,654,655,659],{},[20,652,653],{},"Sending it and going quiet."," A statement opens the conversation. Follow the tactics in ",[54,656,658],{"href":657},"\u002Fhow-to-get-invoices-paid-faster","how to get invoices paid faster"," to keep it moving.",[16,661,662],{},"Used well, the statement of account turns a scattered pile of overdue invoices into one number the client has to look at, acknowledge, and deal with. That clarity is usually what gets you paid.",{"title":664,"searchDepth":665,"depth":665,"links":666},"",3,[667,669,670,674,675,676,677,678,679],{"id":13,"depth":668,"text":14},2,{"id":32,"depth":668,"text":33},{"id":88,"depth":668,"text":89,"children":671},[672,673],{"id":96,"depth":665,"text":97},{"id":204,"depth":665,"text":205},{"id":348,"depth":668,"text":349},{"id":427,"depth":668,"text":428},{"id":487,"depth":668,"text":488},{"id":534,"depth":668,"text":535},{"id":572,"depth":668,"text":573},{"id":627,"depth":668,"text":628},"Document Types","2026-07-15",null,"A statement of account summarizes all outstanding invoices for one client. Learn the two main types, when to send one, and copy a free template.","md",false,{},true,"\u002Fwhat-is-a-statement-of-account","8 min read",{"title":5,"description":683},{"loc":688},"what-is-a-statement-of-account","WN0Vb2hzZLAQlM8QpVRgMSA8SsW3HR0pQHQ6MPKvhWY",[695,1116],{"id":696,"title":697,"author":6,"body":698,"category":1107,"date":1108,"dek":682,"description":1109,"extension":684,"featured":685,"meta":1110,"navigation":687,"path":1111,"readingTime":689,"seo":1112,"sitemap":1113,"stem":1114,"__hash__":1115},"content\u002Fhow-to-bill-clients-for-expenses.md","How to Bill Clients for Expenses: Reimbursable Expenses on Invoices",{"type":8,"value":699,"toc":1094},[700,704,707,714,717,721,724,735,738,758,761,765,768,774,780,787,790,794,797,802,930,936,939,946,950,960,964,978,988,1000,1004,1012,1016,1027,1038,1042,1049,1052,1056,1091],[11,701,703],{"id":702},"what-counts-as-a-reimbursable-expense-and-what-doesnt","What counts as a reimbursable expense (and what doesn't)",[16,705,706],{},"A reimbursable expense is a cost you incur on a project that the client has agreed to pay back. You front the money, then recharge it. Classic examples: a train fare to a client site, a stock photo licence bought for their brochure, a domain and hosting plan set up in their name, or a specialist subcontractor you hired to finish part of the job.",[16,708,709,710,713],{},"What is ",[422,711,712],{},"not"," reimbursable is your ordinary cost of being in business. Your laptop, your accounting software subscription, your home office internet, your professional insurance — those are overhead. You recover them through your rate, not by itemising them on a client invoice. The line matters because clients push back hard when they see costs they consider \"your problem\" appearing on a bill.",[16,715,716],{},"The cleanest test: would this cost exist if the project didn't? A flight booked specifically for one client's workshop fails the \"would exist anyway\" test, so it's reimbursable. Your Adobe subscription would exist regardless, so it's overhead.",[11,718,720],{"id":719},"agree-the-rules-before-you-spend-a-penny","Agree the rules before you spend a penny",[16,722,723],{},"Most expense disputes are really scope disputes that surfaced late. Kill them in the contract or proposal. A short clause is enough:",[540,725,726],{},[16,727,728],{},[422,729,730,731,734],{},"Expenses: The Client will reimburse pre-approved out-of-pocket costs incurred on this project, including travel, accommodation, third-party software licences, and subcontractor fees. Costs above $150 per item require written approval in advance. Expenses are billed at cost and supported by receipts. Mileage is charged at ",[548,732,733],{},"rate"," per mile.",[16,736,737],{},"Three things that clause does for you:",[38,739,740,746,752],{},[41,741,742,745],{},[20,743,744],{},"Sets an approval threshold."," Anything above the limit needs a yes in writing. Below it, you're covered to just spend and recharge.",[41,747,748,751],{},[20,749,750],{},"States the markup policy up front"," (here, \"at cost\" — no markup). Decide this deliberately; more on markup below.",[41,753,754,757],{},[20,755,756],{},"Requires receipts",", which signals you'll keep clean records and pre-empts the \"can you prove that?\" conversation.",[16,759,760],{},"Get the client to confirm expensive items by email before you commit. A one-line \"Booking the Tuesday flight at £142, confirming that's approved\" costs you nothing and turns a possible fight into a paper trail.",[11,762,764],{"id":763},"to-mark-up-or-not-to-mark-up","To mark up or not to mark up",[16,766,767],{},"There are two honest positions, and clients treat them very differently.",[16,769,770,773],{},[20,771,772],{},"Billing at cost (pass-through)."," You recharge exactly what you paid. A £142 flight becomes a £142 line. This is the norm for genuine third-party disbursements and it builds trust because there's nothing to argue about. The downside: you carry the cash-flow burden and admin for free.",[16,775,776,779],{},[20,777,778],{},"Adding a handling markup."," Some agencies add 10–20% to expenses to cover the time spent booking, coordinating, and financing the cost. This is legitimate as long as it's disclosed. What damages relationships is a hidden markup a client discovers by seeing the original receipt. If you mark up, either state the percentage in your contract or fold the handling into a separate \"coordination fee\" line rather than inflating the receipt total.",[16,781,782,783,786],{},"A middle path many freelancers use: pass genuine disbursements through at cost, but bill your own ",[422,784,785],{},"time"," spent managing a subcontractor or sourcing materials as normal billable hours. That keeps the expense honest and still pays you for the work.",[16,788,789],{},"For mileage, use your tax authority's standard rate as a defensible number rather than guessing. In the US the IRS sets an annual business mileage rate; the UK uses HMRC approved mileage allowance payments (commonly quoted as 45p per mile for the first 10,000 miles); Canada and Australia publish their own per-kilometre figures. These change, so check the current rate for your country each tax year.",[11,791,793],{"id":792},"how-to-list-expenses-on-the-invoice","How to list expenses on the invoice",[16,795,796],{},"Keep expenses visually distinct from your fees. Clients scan invoices, and burying a £600 subcontractor cost inside your service total invites suspicion. Two structures work well.",[16,798,799],{},[20,800,801],{},"Option A — a dedicated expenses block:",[108,803,804,818],{},[111,805,806],{},[114,807,808,810,813,816],{},[117,809,125],{},[117,811,812],{},"Qty",[117,814,815],{},"Rate",[117,817,128],{},[133,819,820,834,847,860,872,884,899,915],{},[114,821,822,825,828,831],{},[138,823,824],{},"Web design services (June)",[138,826,827],{},"22 hrs",[138,829,830],{},"$85",[138,832,833],{},"$1,870.00",[114,835,836,841,843,845],{},[138,837,838],{},[20,839,840],{},"Reimbursable expenses",[138,842],{},[138,844],{},[138,846],{},[114,848,849,852,855,858],{},[138,850,851],{},"Stock photography licence (invoice #A-2231)",[138,853,854],{},"1",[138,856,857],{},"$79.00",[138,859,857],{},[114,861,862,865,867,870],{},[138,863,864],{},"Return train fare, London↔Bristol (12 Jun)",[138,866,854],{},[138,868,869],{},"$64.00",[138,871,869],{},[114,873,874,877,879,882],{},[138,875,876],{},"Subcontractor: copywriting (J. Okafor)",[138,878,854],{},[138,880,881],{},"$450.00",[138,883,881],{},[114,885,886,891,893,895],{},[138,887,888],{},[20,889,890],{},"Subtotal — services",[138,892],{},[138,894],{},[138,896,897],{},[20,898,833],{},[114,900,901,906,908,910],{},[138,902,903],{},[20,904,905],{},"Subtotal — expenses",[138,907],{},[138,909],{},[138,911,912],{},[20,913,914],{},"$593.00",[114,916,917,921,923,925],{},[138,918,919],{},[20,920,458],{},[138,922],{},[138,924],{},[138,926,927],{},[20,928,929],{},"$2,463.00",[16,931,932,935],{},[20,933,934],{},"Option B — a separate expenses invoice"," entirely, cross-referenced to the project. Useful when expenses are large or arrive on a different timeline than your fees, and when a client's accounts team codes reimbursements to a different budget.",[16,937,938],{},"Either way, name the specific supplier, date, and purpose on each line. \"Travel — $64\" is weak. \"Return train fare, London↔Bristol, 12 Jun client workshop — $64\" gets approved without a follow-up email. Attach the underlying receipts as a PDF; don't wait to be asked.",[16,940,941,942,945],{},"If you're building invoices by hand, the layout principles in ",[54,943,944],{"href":579},"how to make an invoice in Excel, Word or Google Docs"," apply here too — a clean expenses subtotal is just another block.",[11,947,949],{"id":948},"the-vat-and-sales-tax-part-people-get-wrong","The VAT and sales-tax part people get wrong",[16,951,952,953,956,957,23],{},"This is where recharging expenses gets genuinely technical, and the rules differ by tax and by country. Two concepts get confused constantly: ",[20,954,955],{},"recharges"," and ",[20,958,959],{},"disbursements",[94,961,963],{"id":962},"recharges-vs-disbursements-vat-registered-businesses","Recharges vs disbursements (VAT-registered businesses)",[16,965,50,966,969,970,973,974,977],{},[20,967,968],{},"recharge"," is a cost you incurred ",[422,971,972],{},"for your own business"," in order to deliver the service, which you then pass on. Your train fare to a client meeting is your cost — you bought the ticket, you travelled. When you recharge it, it becomes part of the consideration for your service, so in the UK and similar VAT systems you generally add VAT to it at your service rate, ",[422,975,976],{},"even if the original ticket was zero-rated or VAT-exempt",". That surprises people: a zero-rated train fare recharged to a client typically gets 20% VAT added because it's now part of your taxable supply.",[16,979,50,980,983,984,987],{},[20,981,982],{},"disbursement"," is a cost you paid ",[422,985,986],{},"as the client's agent"," — the goods or services were supplied to the client, not to you, and you merely handled the payment. A statutory fee (say, a companies-registry filing fee paid on the client's behalf) can qualify. Disbursements are passed on at exact cost with no VAT added by you, but they must meet strict conditions: the client received the supply, you were acting as their agent, and you show the cost separately. Getting this wrong means under- or over-charging VAT.",[16,989,990,991,994,995,999],{},"Practical takeaway for UK and EU-style VAT: most of what freelancers call \"expenses\" are actually recharges, not disbursements, so you add VAT. Read ",[54,992,993],{"href":84},"UK VAT invoices explained"," and, if you're near the threshold, ",[54,996,998],{"href":997},"\u002Fdo-i-need-to-register-for-vat","do I need to register for VAT",". Rules vary — confirm your specific situation with HMRC or an accountant.",[94,1001,1003],{"id":1002},"us-sales-tax","US sales tax",[16,1005,1006,1007,1011],{},"Whether a reimbursed expense is taxable depends on the state and on whether the underlying item was taxable and how it's characterised. Reimbursed costs that are part of a bundled taxable service can be taxable; a separately stated pass-through of a non-taxable item may not be. There's no single national rule. The overview in ",[54,1008,1010],{"href":1009},"\u002Fus-sales-tax-on-invoices","US sales tax on invoices"," is a starting point, but check your state.",[94,1013,1015],{"id":1014},"canada-and-australia","Canada and Australia",[16,1017,1018,1019,1023,1024,1026],{},"For GST\u002FHST in Canada, recharged expenses generally follow the tax treatment of your overall supply; see ",[54,1020,1022],{"href":1021},"\u002Fcanada-gst-hst-invoice-requirements","Canada GST\u002FHST invoice requirements",". In Australia, GST on reimbursements versus true disbursements follows a similar agent-vs-principal logic to the UK; a valid ",[54,1025,80],{"href":79}," still needs the right GST breakdown.",[16,1028,1029,1030,1033,1034,1037],{},"One more trap: ",[20,1031,1032],{},"don't double-count VAT\u002FGST you've already reclaimed."," If you're VAT-registered and reclaimed the input tax on that £79 stock photo, you recharge the £79 net (pre-VAT) figure and add your own VAT on top. Recharging the VAT-inclusive amount ",[422,1035,1036],{},"and"," adding VAT again overcharges the client.",[11,1039,1041],{"id":1040},"keep-the-receipts-and-keep-them-findable","Keep the receipts, and keep them findable",[16,1043,1044,1045,23],{},"Every recharged cost needs a supporting document you can produce on demand: the supplier invoice, the ticket, the mileage log. Tax authorities can ask you to justify both the expense you claimed and the amount you recharged. Retention periods vary (commonly several years), so store them with the project. The practical mechanics are covered in ",[54,1046,1048],{"href":1047},"\u002Fhow-long-to-keep-invoices-and-receipts","how long to keep invoices and receipts",[16,1050,1051],{},"A simple system: create a folder per project, drop every receipt in as you incur it, and log the date, supplier, amount, and whether tax was charged in a spreadsheet. When invoice day arrives the expenses block writes itself.",[11,1053,1055],{"id":1054},"handling-the-awkward-cases","Handling the awkward cases",[38,1057,1058,1064,1074,1085],{},[41,1059,1060,1063],{},[20,1061,1062],{},"The client rejects an expense after the fact."," If it was under your approval threshold and inside the contract's categories, point to the clause. If it was over the threshold and you didn't get sign-off, you may have to eat it — which is exactly why the threshold exists.",[41,1065,1066,1069,1070,1073],{},[20,1067,1068],{},"A subcontractor you're recharging."," You're the principal: you hired them, you pay them, you recharge the client. Their invoice is addressed to ",[422,1071,1072],{},"you",", and you issue your own invoice to the client. Don't just forward the sub's invoice.",[41,1075,1076,1079,1080,1084],{},[20,1077,1078],{},"Foreign-currency expenses on an overseas project."," Convert at the rate on the date you paid, note the rate, and be consistent. ",[54,1081,1083],{"href":1082},"\u002Fhow-to-invoice-international-clients","Invoicing international clients"," covers the currency and payment side.",[41,1086,1087,1090],{},[20,1088,1089],{},"Expenses that arrive after final payment."," Bill them promptly on a short-dated invoice rather than sitting on them. A late \"oh, and there's also £200 of expenses\" three months on reads as disorganised and gets queried.",[16,1092,1093],{},"Recharging expenses well is mostly about being boringly transparent: agree the rules in writing, spend inside the agreed limits, itemise clearly, attach the receipts, and apply the right tax treatment for your jurisdiction. Do that and expenses stop being a source of friction and become just another clean line on the invoice.",{"title":664,"searchDepth":665,"depth":665,"links":1095},[1096,1097,1098,1099,1100,1105,1106],{"id":702,"depth":668,"text":703},{"id":719,"depth":668,"text":720},{"id":763,"depth":668,"text":764},{"id":792,"depth":668,"text":793},{"id":948,"depth":668,"text":949,"children":1101},[1102,1103,1104],{"id":962,"depth":665,"text":963},{"id":1002,"depth":665,"text":1003},{"id":1014,"depth":665,"text":1015},{"id":1040,"depth":668,"text":1041},{"id":1054,"depth":668,"text":1055},"Invoicing Basics","2026-07-29","How to recharge travel, materials, software and subcontractor costs to clients, whether to add markup, and how VAT and sales-tax rules apply.",{},"\u002Fhow-to-bill-clients-for-expenses",{"title":697,"description":1109},{"loc":1111},"how-to-bill-clients-for-expenses","RpKUmFUK7kvh-_hOs2fJkgj3NKtNotmV5Fped0xpX-s",{"id":1117,"title":1118,"author":6,"body":1119,"category":1107,"date":1619,"dek":682,"description":1620,"extension":684,"featured":685,"meta":1621,"navigation":687,"path":1622,"readingTime":689,"seo":1623,"sitemap":1624,"stem":1625,"__hash__":1626},"content\u002Fwhat-is-progress-billing.md","What Is Progress Billing? How to Invoice a Project in Stages",{"type":8,"value":1120,"toc":1609},[1121,1125,1128,1131,1143,1147,1150,1170,1177,1183,1189,1192,1196,1199,1202,1339,1350,1354,1357,1374,1377,1380,1439,1442,1450,1454,1457,1463,1478,1484,1489,1492,1498,1504,1508,1511,1516,1524,1529,1549,1552,1556,1559,1596,1600,1603,1606],[11,1122,1124],{"id":1123},"getting-paid-before-the-project-ends","Getting paid before the project ends",[16,1126,1127],{},"A web build quoted at $18,000 takes four months. If you invoice once at the end, you're effectively lending the client the cost of a third of a year's work, absorbing every scope change and stall, and betting your cash flow on a single payment that may arrive 30 days after the final sign-off. That's month five before a dollar lands.",[16,1129,1130],{},"Progress billing fixes this. Instead of one invoice, you break the project into stages and bill for each as you complete it. The client pays as value is delivered; you fund the work as you go. It's the standard model in construction, engineering, and large creative or software projects, and it scales down neatly to a solo freelancer running a $6,000 branding job.",[16,1132,1133,1134,1138,1139,1142],{},"This is different from a one-off ",[54,1135,1137],{"href":1136},"\u002Fhow-to-ask-for-a-deposit-upfront-invoices","deposit invoice"," or a fixed monthly ",[54,1140,1141],{"href":214},"retainer",". A deposit is a single upfront payment. A retainer bills a recurring fee regardless of specific deliverables. Progress billing charges incrementally against measurable chunks of one large project as they're finished.",[11,1144,1146],{"id":1145},"how-progress-billing-actually-works","How progress billing actually works",[16,1148,1149],{},"Every progress-billed project rests on three decisions you make before you start:",[493,1151,1152,1158,1164],{},[41,1153,1154,1157],{},[20,1155,1156],{},"The total contract value."," The agreed price for the whole job (or a clear rate structure if it's time-and-materials).",[41,1159,1160,1163],{},[20,1161,1162],{},"The billing triggers."," What event releases each invoice, a calendar date, a completed milestone, or a percentage of work done.",[41,1165,1166,1169],{},[20,1167,1168],{},"The schedule of values."," A line-by-line breakdown showing how the total is split across stages.",[16,1171,1172,1173,1176],{},"Two broad methods exist for deciding ",[422,1174,1175],{},"when"," to bill:",[16,1178,1179,1182],{},[20,1180,1181],{},"Milestone billing."," You invoice when a defined deliverable is complete: \"homepage design approved,\" \"database migration signed off.\" Best when the work has clear, discrete stages. Clients like it because they're paying for something they can see.",[16,1184,1185,1188],{},[20,1186,1187],{},"Percentage-of-completion billing."," You invoice based on how much of the total work is finished, often assessed monthly. A builder might bill for 40% of a job at the end of month two. This suits long, continuous work where deliverables blur together. It requires an honest, defensible way to estimate \"percent complete,\" which is where disputes usually start.",[16,1190,1191],{},"Most small-business projects use milestones. They're concrete and hard to argue with.",[11,1193,1195],{"id":1194},"building-a-schedule-of-values","Building a schedule of values",[16,1197,1198],{},"The schedule of values is the backbone. It's a table, agreed in the contract, that both parties reference for the life of the project. Keep the number of stages sensible: too few and you're back to lump-sum risk, too many and you drown in admin.",[16,1200,1201],{},"Here's a schedule for that $18,000 website, split into five stages plus a deposit:",[108,1203,1204,1221],{},[111,1205,1206],{},[114,1207,1208,1211,1213,1216,1218],{},[117,1209,1210],{},"Stage",[117,1212,125],{},[117,1214,1215],{},"% of total",[117,1217,128],{},[117,1219,1220],{},"Trigger",[133,1222,1223,1240,1256,1271,1288,1303,1319],{},[114,1224,1225,1228,1231,1234,1237],{},[138,1226,1227],{},"0",[138,1229,1230],{},"Mobilisation deposit",[138,1232,1233],{},"20%",[138,1235,1236],{},"$3,600",[138,1238,1239],{},"On contract signing",[114,1241,1242,1244,1247,1250,1253],{},[138,1243,854],{},[138,1245,1246],{},"Discovery & sitemap approved",[138,1248,1249],{},"15%",[138,1251,1252],{},"$2,700",[138,1254,1255],{},"Client sign-off on IA",[114,1257,1258,1261,1264,1266,1268],{},[138,1259,1260],{},"2",[138,1262,1263],{},"Design mockups approved",[138,1265,1233],{},[138,1267,1236],{},[138,1269,1270],{},"Client sign-off on designs",[114,1272,1273,1276,1279,1282,1285],{},[138,1274,1275],{},"3",[138,1277,1278],{},"Development complete (staging)",[138,1280,1281],{},"25%",[138,1283,1284],{},"$4,500",[138,1286,1287],{},"Site live on staging server",[114,1289,1290,1293,1296,1298,1300],{},[138,1291,1292],{},"4",[138,1294,1295],{},"Testing, revisions, launch",[138,1297,1249],{},[138,1299,1252],{},[138,1301,1302],{},"Site live on production",[114,1304,1305,1308,1311,1314,1316],{},[138,1306,1307],{},"5",[138,1309,1310],{},"Retention release",[138,1312,1313],{},"5%",[138,1315,280],{},[138,1317,1318],{},"30 days after launch, no defects",[114,1320,1321,1323,1327,1332,1337],{},[138,1322],{},[138,1324,1325],{},[20,1326,458],{},[138,1328,1329],{},[20,1330,1331],{},"100%",[138,1333,1334],{},[20,1335,1336],{},"$18,000",[138,1338],{},[16,1340,1341,1342,1345,1346,1349],{},"Notice stage 5. That's ",[20,1343,1344],{},"retainage"," (also called retention), a slice of the total held back until after final delivery to guarantee you fix defects. It's ingrained in construction, where 5–10% is typical, and it's increasingly reasonable for larger creative and software work. As the contractor being billed ",[422,1347,1348],{},"against",", you want retainage low and released quickly; as the party doing the work, you accept it because it reassures a nervous client. State the release condition precisely: \"5% retained, payable 30 days after production launch provided no critical defects remain open.\"",[11,1351,1353],{"id":1352},"what-goes-on-each-progress-invoice","What goes on each progress invoice",[16,1355,1356],{},"A progress invoice looks like a normal invoice with a few extra fields that show where this payment sits in the bigger picture. Every one should show:",[38,1358,1359,1362,1365,1368,1371],{},[41,1360,1361],{},"The overall contract value",[41,1363,1364],{},"This stage's amount (the \"current claim\")",[41,1366,1367],{},"Total billed to date, including this invoice",[41,1369,1370],{},"Total remaining after this invoice",[41,1372,1373],{},"Any retainage held",[16,1375,1376],{},"That running tally prevents the most common progress-billing argument: the client losing track of what they've already paid.",[16,1378,1379],{},"Here's how a stage 2 invoice might read:",[540,1381,1382,1388,1429,1436],{},[16,1383,1384,1387],{},[20,1385,1386],{},"Invoice #2026-034","\nProject: Website redesign — Contract value $18,000",[108,1389,1390,1399],{},[111,1391,1392],{},[114,1393,1394,1397],{},[117,1395,1396],{},"Line item",[117,1398,128],{},[133,1400,1401,1409,1417],{},[114,1402,1403,1406],{},[138,1404,1405],{},"Stage 2: Design mockups approved (20% of contract)",[138,1407,1408],{},"$3,600.00",[114,1410,1411,1414],{},[138,1412,1413],{},"Less retainage (5% of this claim)",[138,1415,1416],{},"–$180.00",[114,1418,1419,1424],{},[138,1420,1421],{},[20,1422,1423],{},"Amount due this invoice",[138,1425,1426],{},[20,1427,1428],{},"$3,420.00",[16,1430,1431,1432,1435],{},"Contract value: $18,000.00\nPreviously billed (stages 0–1): $6,300.00\nThis claim: $3,600.00\n",[20,1433,1434],{},"Billed to date: $9,900.00 (55%)","\nRetainage held to date: $495.00\nRemaining to bill: $8,100.00",[16,1437,1438],{},"Payment terms: Net 14. Work on stage 3 begins on receipt.",[16,1440,1441],{},"Whether you deduct retainage from each claim or hold it all in a final stage is a style choice; both are fine as long as the contract and the invoice math agree. Deducting a little from each claim (as above) is cleaner because the client always sees the running retention figure.",[16,1443,1444,1445,1449],{},"Number your invoices in a consistent sequence so the project's billing history is auditable. If you juggle several clients, see ",[54,1446,1448],{"href":1447},"\u002Finvoice-numbering-best-practices","invoice numbering best practices"," for a scheme that won't collapse under multiple projects.",[11,1451,1453],{"id":1452},"contract-wording-that-protects-you","Contract wording that protects you",[16,1455,1456],{},"Progress billing lives or dies by what's written before work starts. The schedule of values belongs in the signed contract or statement of work, not buried in an email. Include clauses covering:",[16,1458,1459,1462],{},[20,1460,1461],{},"The trigger definition."," Vague triggers cause disputes. \"Design phase complete\" invites argument; \"Client provides written approval of homepage and two interior page mockups via email or project tool\" does not.",[16,1464,1465,1468,1469,1473,1474,1477],{},[20,1466,1467],{},"Payment terms per stage."," Short terms suit staged work. Net 7 to Net 14 is common; some freelancers use ",[54,1470,1472],{"href":1471},"\u002Fdue-on-receipt-payment-terms","due on receipt"," for deposits and early stages. Whatever you pick, spell out your ",[54,1475,1476],{"href":482},"late fee"," policy too.",[16,1479,1480,1483],{},[20,1481,1482],{},"A stop-work clause."," The single most valuable line in a progress-billing contract:",[540,1485,1486],{},[16,1487,1488],{},"\"Work on the subsequent stage will not commence until payment for the preceding stage has been received in full. Timelines extend automatically by any period of delayed payment.\"",[16,1490,1491],{},"This turns your invoice into a gate. No payment, no progress. It's the natural leverage staged billing gives you, and it beats chasing an $18,000 balance at the end.",[16,1493,1494,1497],{},[20,1495,1496],{},"Scope-change handling."," When the client adds work mid-project, don't quietly absorb it into an existing stage. Issue a change order that adjusts the contract value and, if needed, adds a stage. Revised schedule of values, signed, then carry on.",[16,1499,1500,1503],{},[20,1501,1502],{},"Deposit and retainage terms."," State the deposit amount, whether it's refundable, and how it's applied (usually credited against stage 0 or spread across the first stages). State the retainage percentage and its precise release condition.",[11,1505,1507],{"id":1506},"a-worked-cash-flow-comparison","A worked cash-flow comparison",[16,1509,1510],{},"The point of all this is timing. Same $18,000 project, two approaches:",[16,1512,1513],{},[20,1514,1515],{},"Lump-sum, Net 30, invoiced at completion (month 4):",[38,1517,1518,1521],{},[41,1519,1520],{},"Cash in: $0 until roughly day 150",[41,1522,1523],{},"You self-fund four months of work",[16,1525,1526],{},[20,1527,1528],{},"Progress-billed against the schedule above:",[38,1530,1531,1534,1537,1540,1543,1546],{},[41,1532,1533],{},"Month 0: $3,600 deposit",[41,1535,1536],{},"Month 1: $2,700 (stage 1)",[41,1538,1539],{},"Month 2: $3,420 (stage 2, net of retainage)",[41,1541,1542],{},"Month 3: $4,275 (stage 3, net of retainage)",[41,1544,1545],{},"Month 4: $2,565 (stage 4, net of retainage)",[41,1547,1548],{},"Month 5: $2,340 (stage 5 + accumulated retainage $900)",[16,1550,1551],{},"By the end of month 2 you've collected $9,720 on a project you're only a bit over halfway through delivering. That's the difference between a healthy freelance business and one perpetually one late invoice away from trouble.",[11,1553,1555],{"id":1554},"tax-and-record-keeping-notes","Tax and record-keeping notes",[16,1557,1558],{},"A few things to get right, and rules vary by jurisdiction, so confirm with your tax authority or an accountant:",[38,1560,1561,1581,1587],{},[41,1562,1563,1566,1567,1569,1570,1572,1573,1576,1577,1580],{},[20,1564,1565],{},"When to recognise income and charge sales tax\u002FVAT"," usually depends on when each invoice is issued or paid, not on when the whole project finishes. If you're VAT-registered in the UK, each progress invoice is generally a tax point in its own right; see ",[54,1568,993],{"href":84},". US sales tax on services varies by state, covered in ",[54,1571,1010],{"href":1009},". Canadian GST\u002FHST has its own ",[54,1574,1575],{"href":1021},"invoice requirements",", and Australian ",[54,1578,1579],{"href":79},"tax invoices"," have set fields.",[41,1582,1583,1586],{},[20,1584,1585],{},"Deposits can be treated differently from progress claims"," for tax purposes in some jurisdictions. Don't assume they're the same.",[41,1588,1589,1592,1593,1595],{},[20,1590,1591],{},"Keep every progress invoice, change order, and sign-off email"," for the whole project and beyond. Guidance on ",[54,1594,1048],{"href":1047}," applies here.",[11,1597,1599],{"id":1598},"when-progress-billing-isnt-worth-it","When progress billing isn't worth it",[16,1601,1602],{},"Skip it for anything short or small. A $900 logo delivered in a week doesn't need five invoices, take a deposit and bill the balance. Progress billing carries admin overhead: more invoices, more approvals, more tracking. The break-even point is roughly a project long enough or large enough that carrying the full cost to completion would strain your cash or your nerves.",[16,1604,1605],{},"It also demands a client who signs a proper contract and approves stages promptly. If sign-offs are the bottleneck, add a clause deeming a stage approved if the client doesn't respond within, say, five business days. Otherwise your carefully staged cash flow stalls on someone else's inbox.",[16,1607,1608],{},"Structure the stages, define the triggers in writing, and let each paid invoice unlock the next slice of work. The project funds itself, and you never carry more risk than the current stage.",{"title":664,"searchDepth":665,"depth":665,"links":1610},[1611,1612,1613,1614,1615,1616,1617,1618],{"id":1123,"depth":668,"text":1124},{"id":1145,"depth":668,"text":1146},{"id":1194,"depth":668,"text":1195},{"id":1352,"depth":668,"text":1353},{"id":1452,"depth":668,"text":1453},{"id":1506,"depth":668,"text":1507},{"id":1554,"depth":668,"text":1555},{"id":1598,"depth":668,"text":1599},"2026-07-27","A practical guide to milestone and staged invoicing for freelancers and contractors, covering deposits, progress claims, retainage, and sample wording.",{},"\u002Fwhat-is-progress-billing",{"title":1118,"description":1620},{"loc":1622},"what-is-progress-billing","1f7Wj81KqhhKD9NyCFT0w5kd8bObLSynWMtfQE4jWeY",1785314447468]