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Contractor invoice templates

Contractors perform a wide range of services, from home remodeling to business consulting to tutoring services and beyond. But regardless of specifics, all contractors need to get paid for their services. Our free contractor invoice templates are what you need to request payment in a professional manner, providing the proper layout to calculate hours and days worked in accordance with your determined rate of pay.

Download a contractor invoice template

How to use these invoice templates

Our free contractor invoice templates are simple and intuitive to use. Once downloaded, you can easily customize them to fit your needs. Different projects might call for slightly different invoice formatting—that’s why we made our contractor invoice template so flexible.

  • Simply download the contractor invoice template.
  • Make sure to add your company logo and contact information at the top.
  • Add and remove lines as needed—some jobs may require more or less room for details.
  • Leave space for special notes.
  • Get paid !

What contractors need to know about invoicing

As a contractor, you may charge by the hour for your services, or simply choose to work at a flat rate. Your preferences will determine the specific qualities of your invoicing process. Across the board, you'll need to clearly outline what you're requesting payment for, as well as the price you’re charging. Remember : solid, consistent invoicing will set you up nicely for that year-end 1099 form.

What should be included on an invoice for contractors

True for all contracting work, your individual terms should be included on your invoice in addition to your general rates. An invoice template for an independent contractor who provides multiple services might include a breakdown of their charging process. For example, they may charge a specific hourly rate as well as a separate charge for materials needed to complete the service. As a general rule, you'll want to be as clear and detailed as possible when preparing your invoice.

A standard contractor invoice format should include space for :

  1. Your name or the name of your company
  2. Your client’s name
  3. Invoice number and/or work order number
  4. The date or duration you’re providing your services
  5. For labour costs, a description of your services rendered
  6. For flat rate : dollar amount for cost of labour
  7. For hourly rate : number of hours spent performing work and dollar amount per hour for cost of labour
  8. Total amount for cost of labour
  9. For cost of materials, a description of each material used
  10. Quantity of materials
  11. Cost per unit of materials
  12. Total amount for cost of materials
  13. Miscellaneous charges : a description, quantity and cost for these items (if applicable)
  14. The total price you’re charging, including applicable tax
  15. Separate line items for GST / HST, and PST, if appropriate

As an independent contractor, your taxes are not automatically deducted by your employer to comply with federal, state and city tax requirements. It’s important to remember that at the end of each year when you fill out a 1099 form, you'll be responsible for paying those taxes to the IRS. By making sure to include a line item for any applicable taxes, you guard yourself against withholding too little from your income and being unable to pay your federal, state and city taxes.

Remember to set aside at least 30 % of your income to pay your taxes. Rates may vary according to state (and sometimes) cities, but you'll thank yourself later when you’re able to easily cut a check to the IRS to pay your taxes instead of dipping into your hard-earned profits and savings to do so. Additionally, consider making quarterly payments to the IRS to avoid having to pay your taxes all at once when tax season rolls around.

A further note about taxes

As a contractor, you will likely not be exempt from the Canadian GST (Goods and Services Tax) or the HST (Harmonized Sales Tax). To be compliant with federal regulations, you will have to register for the GST / HST unless you qualify as a “small supplier” and make less than $30,000 each year.

Depending on the province where you conduct business, you may also need to account for HST on your invoices. HST rates vary by province and are a more transparent way of making consumers aware of taxes on products. Previously, a Provincial Sales Tax (PST) was rolled into the costs of goods and service, making it harder to separate those taxes from the cost of items. The HST not only encourages greater transparency, but also reduces administrative and accounting work for both businesses and the government.

HST varies by province, and rates are subject to change. According to the Canada Revenue Agency HST rates for each province have stayed the same since 2016. Please also keep in mind that four provinces also still charge a PST : British Columbia, Manitoba, Saskatchewan, and Quebec. (For businesses operating inside the province of Quebec, you’ll need to register a separate GST / HST account with Revenu Quebec.)

As with the GST, small supplier exemptions may also apply to HST. Additionally, certain groups, such as First Nations business owners may be exempt from the GST / HST.

When to send an invoice

The ideal time to send an invoice varies by industry as well as preference. Invoicing at the beginning of the client engagement ensures you won’t be working for free, though it may be objectionable to a certain clientele. Sending an invoice after the work is completed shows trust on your end, but leaves you open to unsavoury clients taking advantage of that trust.

A simple solution to the latter is choosing only to work with trustworthy clients. Go with your gut—your initial correspondence should provide you with sufficient insight into your client’s character.

Still, it is far from unreasonable to start the invoicing process at the beginning of the engagement. Since contractors often don’t have a larger company standing behind them, it can be customary to request partial or even full payment before your services are rendered.

As you develop experience and foster relationships with repeat clients, your invoicing process may evolve into a more relaxed but streamlined process.

Invoice like a pro

If you want to be a pro, you have to act like one. Check out these field-tested tips to get you on the right track with your invoicing process.

  1. Be professional, be polite – these two qualities can (and must) coexist on your invoice. Clients want to see that you take your work seriously. Professional courtesies include the time-honoured “please and thank you's” as well as clear, honest reporting of your services.
  2. Set clear payment deadlines – providing a “pay by” date for your client helps ensure you get paid promptly and on your terms. Not only that, but setting specific parameters speaks to your professionalism. Clients want to see that you’re established enough to have terms.
  3. Number your invoices – this simple tactic does much for establishing yourself as the real deal. It also makes it easier to keep track of the work you’ve done. If you’re sending your first invoice, you may want to assign it a higher number to come off as more experienced.

At some point, you’ll want to consider automating your invoicing process. Be sure to check out Sage Business Cloud Accounting online invoicing to really streamline your whole operation.

Invoicing tips from business owners like you

Contractors are a special breed—the ability to set your own working terms is invaluable. But your independence also leaves you especially susceptible to the hard learning curve of good business practices. These tips from business owners and individuals like you can help you avoid some common mistakes.

  • Send detailed proposals – especially with contractor work, it’s important to send a detailed proposal of your services before you perform the work, spelling out exactly what you'll provide as well as how much you’ll charge for it. This provides a record of your agreed-to terms to stand in your corner if any issues arise down the line. Making sure you and your client are on the same page makes everything go smoothly.
  • Accept all forms of payment – the world is changing and as a service provider you have to adapt. People want to pay in the way that’s most convenient for them. If you have limitations to the forms of payment you accept, you’re only decreasing your chances of getting paid. As a contractor, you’re in a great position to be flexible and adaptive—take advantage of that. Clearly state which terms of payment you accept on your invoice (check, credit card, PayPal, Venmo or other options) and allow your customers to choose which is easiest for them.
  • Craft invoices around clients – as a contractor, you likely have to do a lot of things on your own. One benefit of that is the freedom to personalize your invoices, since you alone are preparing them. That’s a great opportunity to make your client feel properly attended to and ensure repeat business. Specificity lets the client know you're taking their needs personally. In addition to carefully itemizing your invoices for your client’s benefit, you can go the extra mile and leave them a personalized note on the invoice, too. For instance, let the client know your favorite part of the project, or leave them with some warm words that let them know you don’t just see them as a customer, but as a person. For instance, if you’re a graphic designer, you may leave them a note on your invoice that says, “I really enjoyed creating this business card for you, Mary. Can’t wait to hear about your upcoming trade show !”

Download a contractor invoice template

Take your invoicing to the next level with Sage Business Cloud Accounting

Save time and save trees by switching to online invoicing with Sage Business Cloud Accounting. Upgrading is easy and can make all the difference when positioning your business in the modern world. An online presence is essential for businesses today—and adapting to your customers’ preferred methods of payment can set you apart from your competitors. Sage Business Cloud online invoicing digitizes and automates the billing process, making sure you get paid and your customers stay happy.

Start your free trial today !

Additional invoice templates

Do our contractor invoice templates meet your needs ? If not, check out our other templates. We offer solutions for all of your invoicing needs.