Guide
Deposit invoices: bill the deposit, then the balance
A deposit invoice asks for part of the price up front. The final invoice shows the full price, takes off what was paid and asks for the balance. A receipt confirms money you already have.
From quote to paid: the documents in order
Here is one job, built-in oak bookcases for $6,800.00 with a 50% deposit, from the first price to the last payment. Each step opens in the matching Billpad generator with these figures filled in.
| Step | Document | What it says | Asks for money? |
|---|---|---|---|
| 1. Price agreed | Estimate or quote EST-0042 | The work, the price ($6,800.00) and the deposit terms: “50% on acceptance, balance on installation”. | No |
| 2. Deposit requested | Deposit invoice INV-0310, or a proforma invoice | One line: “50% deposit per quote EST-0042”, $3,400.00, with its own due date. | Yes, the deposit |
| 3. Deposit paid | Receipt RCT-0410 | $3,400.00 received by bank transfer, against a $6,800.00 order: $3,400.00 remaining. | No, it confirms a payment |
| 4. Work done | Final invoice INV-0327 | The full job ($6,800.00), the deposit already paid (−$3,400.00) and the balance due ($3,400.00). | Yes, the balance |
| 5. Balance paid | Receipt, or the invoice marked paid | The final payment and a zero balance. | No |
Open the deposit invoice Open the deposit receipt Open the final invoice
How to write a deposit invoice
- Give it a normal invoice number from your usual sequence. A deposit invoice is a real invoice, not a draft.
- Bill the deposit as one line that names the quote or contract: “50% deposit: built-in oak bookcases per quote EST-0042”.
- State the full price and what happens next in the notes: “Order total $6,800.00. The balance of $3,400.00 will be invoiced on installation.”
- Show tax the way your tax authority expects for advance payments. In the UK and the EU, VAT on a deposit is generally due when the deposit is received or invoiced, so a VAT-registered business shows VAT on the deposit invoice (HMRC: VAT Notice 700, section 14.2.3 (deposits); VAT Directive 2006/112/EC, Article 65). Elsewhere, check your own rules.
- Say whether it is refundable, as your contract says. The invoice repeats the contract; it doesn’t create the condition.
| Line | Qty | Price | Amount |
|---|---|---|---|
| 50% deposit: built-in oak bookcases per quote EST-0042 | 1 | $3,400.00 | $3,400.00 |
| Amount due | $3,400.00 | ||
Notes on the invoice: Deposit invoice: 50% of the accepted quote EST-0042 (total $6,800.00), due before materials are ordered. The balance of $3,400.00 will be invoiced on installation.
The final invoice: deduct the deposit
The final invoice lists the whole job again, at full price, so it is a complete record of what was supplied. The deposit appears as a payment already received, and the client pays the balance. Don’t simply leave the deposited work off the final invoice: the two invoices would then never show the full sale in one place.
In Billpad, choose + Payment received under the lines and enter the deposit. The invoice then shows Total, Amount paid and Balance due, and the balance becomes the amount due on the PDF. Name the deposit invoice in the notes so both sides can match them.
| Line | Qty | Price | Amount |
|---|---|---|---|
| Built-in oak bookcases, supplied and installed | 1 | $6,400.00 | $6,400.00 |
| Extra shelf, added on site | 2 | $200.00 | $400.00 |
| Total | $6,800.00 | ||
| Amount paid | −$3,400.00 | ||
| Balance due | $3,400.00 | ||
Notes on the invoice: Final invoice for quote EST-0042. Deposit of $3,400.00 paid on 2 October 2026 (deposit invoice INV-0310).
Deposit invoice, proforma or receipt?
| Deposit invoice | Proforma invoice | Receipt | |
|---|---|---|---|
| Purpose | Formally bills part of the price now | Shows what the final invoice will be, so the client can approve or prepay | Confirms money already received |
| In your sales records | Yes, it is an invoice | No, it is not a tax invoice | Records the payment |
| Sent | Before work starts | Before work starts | After the client pays |
| Use when | The client’s accounts team needs a real invoice to pay, or you want the deposit on your books now | The client wants a document to approve or pay against, and the final invoice will follow delivery | The client paid and wants proof, or the deposit was paid without an invoice |
| In Billpad | Invoice generator | Proforma generator | Receipt generator |
A receipt is not a request for money, so never send a receipt for a deposit that hasn’t been paid yet. A receipt with an amount paid lower than the total shows the balance remaining, which is how you confirm a deposit without implying the order is settled.
How different trades take deposits
- Builders and renovators often take a deposit, then stage payments, then a final invoice. See the contractor invoice template.
- Wedding and event photographers take a retainer at booking and the balance before or after the day. See the photography invoice template.
- Designers and agencies commonly ask for 50% up front and 50% on delivery, with rights passing on final payment. See the graphic design invoice template.
Agree the deposit and when the balance is due before you start; the payment terms guide has wording for both. If the balance is late, the late payment guide has reminder wording.
Updated 28 October 2026. General information, not legal or tax advice. Spotted an error or an outdated rule? Contact us. About Billpad.