Example
Revised contract $19,300, billed before $1,840, this stage $6,420, retainage $642, due $5,778.
Also called progress payments, interim billing, or applications for payment.
What it means in practice
Every progress invoice shows the whole picture: the contract sum, what was billed before, what is billed now, any retainage held, and what is left. That is what stops the phone call asking what the last one was for.
The stages come from the schedule of values agreed on the quote. On commercial jobs the same document is usually called a pay application.
Covered in full in the guide to progress billing.
Where it shows up on the paperwork
Each progress invoice shows the contract sum, what was billed before, what is billed now, retainage held, and what is left. On commercial jobs the same document is a pay application.
What goes wrong
- Billing a percentage nobody agreed, rather than the stages on the accepted quote.
- Leaving retainage off the invoice so the amount building up is invisible until the end.
- Adding change orders as loose lines instead of moving the revised contract sum.
Common questions
What is the difference between progress billing and milestone billing?
Milestone billing is progress billing where the stages are named events. The other common form bills a percentage of completion each month, which suits longer commercial work.
How often should I send progress invoices?
When a stage is reached, or monthly on a percentage-of-completion job. The rhythm should match the client's payment run, which is usually monthly.
What does a progress billing format look like?
A progress invoice shows the contract value, the percentage or the stage complete, the amount earned to date, what was invoiced previously, what is due on this invoice, and any retainage held back. On construction work it usually sits on a schedule of values, with each part of the job given a value so that percentage complete is measurable rather than argued. The project invoice calculator lays it out in that format.