Construction invoice template with progress billing and retainage

How construction projects are usually billed

Construction jobs are rarely billed in one go. Larger projects are usually billed monthly against a schedule of values, which splits the contract into work items. Smaller residential jobs often use milestone payments, such as foundation, frame, lock up and completion. Cost plus contracts bill actual costs plus an agreed fee.

Whatever the method, every invoice on the job should tie back to the contract total, so anyone can see how much has been billed to date and how much remains.

Progress billing with a schedule of values

A construction progress invoice bills the share of each work item completed since the last claim. You multiply each item’s value by its percent complete, subtract what was billed before, and bill the difference. The worked example below uses a $120,000 contract with example figures.

Gross this period is $23,050. With 5% retainage held, $1,152.50 is held back and $21,897.50 is payable.

Other lines on a construction invoice template

Beyond the progress lines, construction invoices carry a handful of recurring items. Label each clearly and keep them separate from the schedule of values so the percentages stay clean. The prices here are examples only, to show how each item is often charged.

Retainage, lien waivers and supporting papers

Many construction contracts let the owner hold back a share of each progress payment, called retainage or retention, until the job is complete. The contract sets the rate and release terms. Show the gross amount, the retainage and the net due on every claim, then bill the total held as one final line.

US owners and lenders often ask for lien waivers with each payment, and some want photos or an inspection sign off before approving a claim. Payment claim rules differ between countries and states, and some places set formal timelines, so check your contract and local rules. Outside the US, our Canadian GST/HST invoice guide covers tax wording.

Construction invoicing mistakes

Progress invoices are checked line by line against the site, which means errors are spotted, and a single disputed line can hold up the whole claim. These are the mistakes that tend to turn a routine monthly claim into a back and forth.

1. Billing ahead of the work. If framing is 45% done, claiming 60% damages trust for the rest of the job.
2. Change orders billed before approval. Bill them only once signed, by number.
3. Losing track of previous claims. Each invoice should show billed to date and balance to finish.
4. Forgetting retainage at the end. Send a separate release invoice when the job closes.
5. Missing the owner’s cutoff. A claim received after the monthly deadline can wait a full cycle.

Working with the construction template

Choose Word, Excel or PDF from the download buttons on this page. The Excel version suits schedule of values math best. To work online, the construction invoice generator with a progress claim sample loads the example above, ready for your own contract items and percentages.

Subcontractors billing a general contractor can use the contractor and subcontractor invoice, and finishing trades the painting invoice template. Deposits before work starts are covered in deposit invoices explained, and you can see every layout on the invoice templates page. Pricing a new build first? Try the builder quote template.