Definition
A progress invoice bills a portion of a larger project as work is completed, rather than one invoice at the end. Each progress invoice covers a milestone or percentage of completion and shows the amount billed to date, so the client and contractor can track the project total against payments.
Also called: Interim invoice, Milestone invoice, Progress billing
Progress invoice in practice
Progress invoicing is standard in construction, large design projects, and software development. It spreads cash flow for the contractor and limits the client's exposure to one large final bill.
A good progress invoice shows the total contract value, the percentage or milestone being billed, amounts previously invoiced, and the remaining balance.
Example
On a $30,000 kitchen remodel, the contractor bills 30 percent at demolition, 40 percent at cabinet install, and 30 percent at completion, each on its own progress invoice.
Frequently Asked Questions
How is a progress invoice different from a deposit invoice?
A deposit invoice is billed before work starts to secure the job. Progress invoices are billed during the project as milestones are reached. Both are credited against the final total.