How to Ask for a Deposit: Upfront & Deposit Invoices

Why Take a Deposit at All

A deposit is an upfront payment a client makes before you start work. It does two useful things: it covers your early costs (materials, time, booking out your calendar) and it proves the client is serious. For new clients, large projects, or anything with significant upfront expense, a deposit is normal and expected — you're not being difficult by asking.

The trick is to make it a routine part of how you work, not a special favour you're requesting. When a deposit is built into your quote and contract from the start, nobody blinks at it.

How Much to Ask For

There's no universal figure, but common ranges give you a sensible starting point:

Services / freelance25–50% upfront, balance on completion. 50/50 is common for new clients.Large or material-heavy jobsEnough to cover materials and early labour — sometimes structured as staged payments.Bookings (events, photography)A fixed booking fee that secures the date, often non-refundable, plus the balance later.

Whatever you choose, write it into the quote and contract before work begins: the deposit amount, when the balance is due, and whether the deposit is refundable. Our guide on quotes vs estimates covers how to set this up at the offer stage.

How to Invoice a Deposit

A deposit gets its own invoice. Issue a deposit invoice for the upfront portion, clearly labelled, then a second invoice for the balance when the work is done — with the balance invoice showing the deposit already paid and deducted.

On the deposit invoice: label it clearly (e.g. "Deposit invoice — 50% of project total"), show what it covers, and give it a normal invoice number. On the final invoice: show the full project total, then a line for "Less deposit paid" subtracting the amount, leaving the remaining balance due.

Example final invoice: Project total £2,000 → "Less deposit paid (Inv #101): −£1,000" → Balance due: £1,000. The client can see exactly how the numbers tie together.

The Tax Point a Deposit Can Create

Here's the part people miss. If you're registered for VAT or GST, taking a deposit can trigger a tax point on the amount received — meaning you may need to account for tax on the deposit when you receive it, not later when you finish the work.

In UK VAT, an advance payment generally creates a tax point for that amount on the earlier of when you receive it or when you issue a VAT invoice for it — so where the VAT-invoice rules apply, you'd issue a VAT invoice for the deposit and account for the VAT in that period. Australia generally attributes GST when you receive a part-payment or issue an invoice (depending on your accounting basis). Canada is similar for advance consideration, but a true security deposit is treated as not being payment until it's applied. That carve-out for genuine security deposits is exactly why the details matter.

Don't assume the tax waits until the end. If you're VAT/GST registered, treat a deposit as potentially taxable when received and issue the right paperwork. Confirm the treatment of deposits and booking fees with your accountant or tax authority — the rules have nuances.

Refundable or Non-Refundable?

This is the question that causes the most friction after the fact, so settle it in writing before any money changes hands. A deposit can be one of two things, and they behave very differently:

• A part-payment toward the work. This is the usual freelance arrangement — the deposit is simply the first slice of the total, and once you've started or delivered, it's been earned. If the client cancels after you've done work, you keep the portion that covers what you did.
• A booking fee that secures a slot. Common for photographers, venues, and event work. It's often non-refundable because the moment you hold a date for one client, you're turning others away. Say so plainly: "The £200 booking fee secures your date and is non-refundable if you cancel within 30 days of the event."

A blanket "non-refundable, no exceptions" line can be challenged under consumer law in some places — in the UK, for instance, a deposit term that's unfair to a consumer may not be enforceable, and you generally can't keep more than your genuine losses. Tie any retained amount to real costs you've incurred rather than treating it as an automatic penalty, and you're on much safer ground. Spell out the cancellation window and what happens to the money in each case.

Wording the Request

Keep it matter-of-fact and tied to what was already agreed. A short line does it:

Example: "To get started, I ask for a 50% deposit (£1,000), with the balance due on completion. I'll send the deposit invoice now and we can book in the work as soon as it's settled."

Because it references the agreed terms, it reads as a normal next step rather than an awkward ask. Once the deposit lands, our guide on getting invoices paid faster helps you collect the balance smoothly.

Frequently asked questions

Is it normal to ask for a deposit before starting work?

Yes — for new clients, large projects, or jobs with upfront costs, a deposit is standard and expected. It covers your early expenses and confirms the client is committed. Building it into your quote and contract from the start makes it routine rather than awkward.

How much of a deposit should I ask for?

For services and freelance work, 25–50% upfront with the balance on completion is common (50/50 for new clients). Material-heavy jobs often use staged payments, and bookings typically use a fixed, sometimes non-refundable, booking fee. Always state the figure in the quote and contract.

How do I invoice a deposit?

Issue a separate, clearly labelled deposit invoice for the upfront amount with its own invoice number. When the work is done, send a final invoice for the full total with a 'less deposit paid' line deducting the deposit, leaving the remaining balance due.

Is a deposit refundable?

It depends entirely on what you agreed in writing. A deposit that's a part-payment toward the work is generally earned as you do the work, so you keep the portion covering what you've delivered. A booking fee is often non-refundable because it reserves capacity you can't resell. Either way, set out the cancellation window and the refund position in the quote and contract before taking the money — and tie any amount you keep to genuine costs rather than treating it as a flat penalty, since "non-refundable" terms can be limited by consumer law in some jurisdictions.

Do I have to charge VAT on a deposit?

If you're VAT or GST registered, receiving a deposit as advance payment can create a tax point on that amount when you receive it (or when you invoice it, if earlier), so where the rules apply you'd issue a VAT invoice and account for the tax in that period rather than deferring it to completion. A genuine security deposit held as security — not as payment — is often treated differently until it's applied. Confirm specifics with your tax authority or accountant.