Deposit Invoice Template
A deposit invoice requests an upfront payment before work begins or goods are ordered. The deposit secures the booking, covers early costs like materials, and commits the client to the project. The remaining balance is invoiced later, often with the deposit shown as a credit.
When to use this
- When you need a deposit before reserving a date or starting work
- When materials must be ordered before the project begins
- When your policy requires a percentage up front for new clients
- When custom or made-to-order goods cannot be resold if the client cancels
- When you want commitment from the client before turning away other work
Key fields to include
- Deposit amount and the percentage of the total it represents
- Total project value and the remaining balance after the deposit
- Refund and cancellation terms for the deposit
- Description of the work or goods the deposit reserves
- Payment due date and accepted methods
- Reference to the quote or agreement the deposit relates to
Frequently asked questions
How much deposit should I ask for?
Common practice ranges from 25% to 50% depending on industry and upfront costs. The deposit should cover your non-recoverable costs while remaining reasonable enough not to scare the client away. State the percentage on the invoice.
Is a deposit taxable at the time of payment?
Tax treatment of deposits varies by jurisdiction. In many places, a deposit is taxable when the invoice for it is issued or when payment is received. Check your local tax rules or ask your accountant.
What happens to the deposit on the final invoice?
Show the deposit as a payment or credit on the final invoice, reducing the balance due. This makes it clear the client is not being charged twice for the deposited amount.
More use cases
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