Invoicing for a deposit or part payment, done properly
On bigger jobs, waiting until the end to see any money means you're bankrolling the customer. A deposit and staged payments put the risk back where it belongs.
Where it hurts
For a job that runs weeks, or needs materials bought up front, invoicing only on completion means you carry the whole cost in the meantime. If the customer then drags their feet at the end, you're badly out of pocket on work already done.
Deposits also sort out the time-wasters. Someone willing to pay a bit up front is serious; someone who won't often wasn't going to pay well at the end either.
But taking a deposit properly, recording it, offsetting it against the final invoice, keeping the VAT right, is fiddly enough that plenty of firms skip it and just hope for the best.
What I'd build
I'd set up your accounts package so an invoice can take a deposit up front and part payments as milestones are hit, with a clear final balance that offsets what's already been paid. Xero, QuickBooks and FreeAgent all handle staged billing, and I'll add a Stripe or GoCardless link so the deposit can be paid the moment you send the request. The VAT is handled correctly at each stage, so your accountant stays happy and you stop funding jobs on your own cash.
What changes
- Take a deposit before you commit time or materials
- Bill in stages on longer jobs instead of all at the end
- Deposits offset cleanly against the final balance
- VAT handled right at every stage
Related fixes
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