How to write a contractor invoice that gets paid (free contractor invoice template)

Download the contractor invoice template

Download the contractor invoice template (Excel, .xlsx). No sign-up and no email. It opens in Excel and in Google Sheets: in Google Drive choose New, then File upload, then open the file with Google Sheets.

One file for your company, with these tabs:

• Invoice — a printable invoice: your details, the client and job, the invoice number, date, terms and due date, the contract or PO number, the billing period, line items with change orders on their own lines, sales tax on the lines you mark taxable, retainage, a deposit applied, and the amount due. A contract summary shows the contract to date, what you billed before and what is left to bill.
• Invoice Log — every invoice you send: the due date from your terms, the payments against it, the balance, whether it is overdue and by how many days, the aging bucket, and the next step.
• Payments — every payment received, against the invoice it pays, part payments too.
• Statement, Summary, Setup, Checklist and Start Here — a statement of one client’s unpaid invoices to send when you chase; billed, collected, outstanding and overdue, with the aging and the retainage held; your company details and defaults; and how to use the file.

Blue text is what you type. Black text is a formula. Yellow cells are settings. The sample company has three jobs and a run of service calls, with five invoices overdue, one of them part paid, and a retainage release waiting on a homeowners’ association board. Its dates are set from today, so the flags keep showing; type your own over them.

What a contractor invoice has to include

Federal construction contracts spell out what a proper invoice is, and the list works as a checklist on any job. A proper invoice includes: Acquisition.gov

• Your name and address.
• The invoice date and invoice number. Date it as close as you can to the day you send it.
• The contract number or other authorization for the work, including the order and line item number.
• A description of the work or services performed.
• The delivery and payment terms.
• The name and address of the person in your company that payment goes to.
• The name, title, phone number and mailing address of the person to contact if the invoice is wrong.
• For a progress payment, the backup for the amounts and the certification the contract requires.
• Your taxpayer ID and bank details, but only where the contract asks for them on the invoice.

An invoice without them is not a proper invoice, and the billing office must send it back within 7 days with the reasons. The payment clock runs from a proper invoice, so a missing contract number costs you the days it takes to fix and resend. Acquisition.gov

A private contract may not list any of this, but these are the same things a client’s bookkeeper needs to match the invoice to a job and approve it. On a homeowner job, keep the description in plain words the owner can check against what they saw on site.

Which invoice for which job

• Deposit — money before work starts, where the contract and your state allow one.
• Progress invoice — part of the contract price as the work goes: a percentage complete, a stage reached, or each line of a schedule of values.
• Time and materials — labor hours at your rates and materials at cost plus markup, for work priced that way and for extra work.
• Final invoice — the rest of the contract once the work is done.
• Retainage release — the retainage the client held back, billed on its own when the contract lets you.

Some owners and architects ask for a pay application instead of an invoice: the AIA G702 and G703 bill each line of the schedule of values with the work done to date. Our walkthrough of how to fill out a G702 and G703 covers that form line by line.

Deposits, and billing ahead of the work

Some states cap deposits on home improvement work. In California, the down payment on a home improvement contract cannot be more than $1,000 or 10 percent of the contract amount, whichever is less. California Legislature

The same law says that, apart from the down payment, a California contractor may neither request nor accept payment that exceeds the value of the work performed or material delivered. And once the owner has paid, they can ask for a full and unconditional lien release for the work that payment covered, and hold back further payments until they get it. California Legislature

Other states and many contracts set their own rules. Bill for what is done and delivered, and keep the deposit to what the contract and your state allow.

Payment terms: when an invoice has to be paid

Put a due date on the invoice, not just “Net 30”: a date leaves nothing to work out. The terms come from your contract, and on some jobs from the law.

On federal construction contracts, a progress payment is due 14 days after the billing office receives a proper payment request, and the final payment 30 days after the billing office receives a proper invoice or 30 days after the government accepts the work, whichever is later. If the government pays a proper invoice late and the amount is not in dispute, it pays an interest penalty automatically, without the contractor asking. Acquisition.gov

Some states set deadlines for private work too. In Texas, a private owner who receives a written payment request for work properly performed must pay it no later than the 35th day after receiving it, less any amount the law lets them withhold, and an unpaid amount bears interest at 1.5 percent a month. Texas Legislature

Both pass the deadline down the line. On a federal job, every subcontract must commit the prime contractor to pay the subcontractor for satisfactory work within 7 days of being paid. In Texas, a contractor must pay each subcontractor its share within 7 days of receiving the owner’s payment. A late invoice from you is a late payment to your subs. Acquisition.gov Texas Legislature

When an invoice is late

Before you chase an invoice, find out where it is. It may not have arrived, a line may not match the contract, a change order may not be approved yet, or a lien waiver may be missing. Each of those is fixed with a phone call, and none of them is fixed by waiting.

The template’s Invoice Log suggests a next step for each open invoice, on this routine:

• About five days after sending: confirm it arrived and is approved, or find out what is holding it up.
• The day after it is due: call, and ask whether they have it and whether anything is wrong with it.
• A week overdue: send a statement of everything they owe, and call again.
• A month overdue: check your lien rights and the deadlines that apply to the job.
• Two months overdue: use the remedies in your contract, and talk to your attorney.

Record every payment against the invoice it pays, part payments included, with a note next to any short payment saying why. The log turns that into a balance and days past due for each invoice, and the Summary shows how much is overdue and how old it is. Our guide to why construction payments are late covers the causes of slow payment and what contractors can control.

Retainage is the money most easily forgotten, because nobody sends you a reminder to bill it. The Summary totals what is held and not yet billed for release; for retainage across several jobs, use our free retainage tracker.

Contractor invoice checklist

These are the checks on the template’s Checklist tab.

1. Is it addressed to the right person?

   What a good answer sounds like: The name and address in the contract, and the person or office that approves payment.

2. Does it have its own number and a date?

   What a good answer sounds like: Numbered in order, never reused, and dated the day it is sent.

3. Does it name the contract or PO?

   What a good answer sounds like: The contract number, PO number or job name your client uses to find it.

4. Does it say what the work was?

   What a good answer sounds like: Each line says what was done, or the period it covers, so the client can match it to the job.

5. Are change orders on their own lines?

   What a good answer sounds like: Each with its number, billed once it is approved in writing.

6. Does it follow the contract?

   What a good answer sounds like: Billed on the date, at the stage and in the form the contract says.

7. Is anything billed ahead of the work?

   What a good answer sounds like: Apart from an agreed deposit, it bills for work done and materials delivered.

8. Is retainage shown?

   What a good answer sounds like: What is held back this time and in total, so the release is easy to bill later.

9. Are the due date and how to pay on it?

   What a good answer sounds like: A due date, not just “Net 30”, and how you want to be paid.

10. Is there a name to call?

    What a good answer sounds like: Someone who can fix a disputed line the same day.

11. Do lien waivers go with it?

    What a good answer sounds like: If the client wants a waiver with each payment, it goes with the invoice.

12. Did you confirm it arrived?

    What a good answer sounds like: A call or email about five days after sending, while there is time to fix a problem.

13. Is every payment recorded against its invoice?

    What a good answer sounds like: Part payments too, so balances and the aging stay right.

When an invoice spreadsheet stops being enough

The template works for one company with someone keeping the log up to date. These are the signs it has been outgrown:

• Invoices are typed up from timesheets, receipts and bills that already exist somewhere else, and something gets missed.
• The same cost gets billed twice, or not at all, on a time-and-materials job.
• Nobody can say what has been billed against a contract without opening every invoice.
• Payments reach the bank days before they reach the log, so the aging is never quite right.

At that point the invoice belongs on the job itself, built from the costs and the contract that are already there.

Where WorkHoist helps

WorkHoist bills from the job itself. A progress invoice bills against the job’s schedule of values, with retainage held on each line. A time-and-materials invoice is built from the job’s approved expenses, approved supplier and subcontractor bills, and time cards, each priced with its markup or at the worker’s bill rate, and each cost can only be billed once. When the work is done, a retainage release invoice bills what is still held.

Each invoice is numbered for its project, such as 012-INV-003, and prints as a PDF with your logo and company details, the client, the job, the billing period, the due date and a sales tax line. Email it from WorkHoist and it is marked sent, with a due date 30 days out if it has none, and once that date passes it shows as overdue.

Payments are recorded against each invoice, part payments included, and feed the AR aging report. The client sees their sent invoices, and opens the PDFs, in the client portal. A voided invoice keeps its number and stops counting as billed. Invoices and the payments against them go to QuickBooks Online, one way, when you click Send. WorkHoist does not take payment on an invoice: there is no card or bank payment link for your client, so they pay the way they do now and you record the payment when it arrives.

Questions contractors ask

What should a contractor invoice include?

A contractor invoice should include your business name, address and contact details, a unique invoice number and the invoice date, the client and the job, the contract or PO number, a description of the work in the billing period with each change order on its own line, the amount of each line, sales tax where it applies, any retainage held back, the amount due, the due date and payment terms, how to pay, and the name of the person to contact if something is wrong.

How do you write a construction invoice?

Start from the contract: bill what it allows, when it allows it. List the work done in the period, each change order on its own line with its number, and the amount of each. Take off retainage and any deposit you are applying, and show the amount due with a due date. Add how to pay and who to call. Then log the invoice, confirm it arrived, and record each payment against it.

What is the difference between a contractor invoice and a pay application?

An invoice bills an amount for work, materials or time. A pay application, such as the AIA G702 with its G703 continuation sheet, bills each line of the schedule of values, showing the work completed to date and the retainage, so the owner and architect can check progress line by line. Which one you send depends on what your contract asks for.

How much deposit can a contractor ask for?

It depends on your state and your contract. In California, the down payment on a home improvement contract cannot be more than $1,000 or 10 percent of the contract amount, whichever is less, and apart from the down payment a contractor may not ask for more than the value of the work performed or material delivered. Check your own state’s rules before you set a deposit.

When is a construction invoice due?

When your contract says. Some laws set an outside limit. On federal construction contracts, a progress payment is due 14 days after the billing office receives a proper payment request. In Texas, a private owner must pay a contractor’s written payment request for work properly performed within 35 days of receiving it, less any amount the law lets them withhold.

What should I do when a contractor invoice is overdue?

Call the day after it is due and find out whether the client has it and whether anything is wrong with it. Fix what is wrong and send it again. If it is still unpaid a week later, send a statement of everything the client owes and call again. A month overdue, check your lien rights and the deadlines that apply to the job, and after that use the remedies in your contract.

Is there a free contractor invoice template?

Yes. WorkHoist’s contractor invoice template is a free Excel file, with no sign-up or email, that also opens in Google Sheets. It has a printable invoice with change orders, sales tax, retainage and deposits, an invoice log with due dates and payments, a client statement, and an AR aging summary.