[{"data":1,"prerenderedAt":1425},["ShallowReactive",2],{"page-\u002Fwhat-is-progress-billing":3,"related-\u002Fwhat-is-progress-billing":555},{"id":4,"title":5,"author":6,"body":7,"category":541,"date":542,"dek":543,"description":544,"extension":545,"featured":546,"meta":547,"navigation":548,"path":549,"readingTime":550,"seo":551,"sitemap":552,"stem":553,"__hash__":554},"content\u002Fwhat-is-progress-billing.md","What Is Progress Billing? How to Invoice a Project in Stages","Daniel Reed",{"type":8,"value":9,"toc":528},"minimark",[10,15,19,22,36,40,43,66,74,80,86,89,93,96,99,247,258,262,265,283,286,289,349,352,360,364,367,373,389,395,400,403,409,415,419,422,427,435,440,460,463,467,470,515,519,522,525],[11,12,14],"h2",{"id":13},"getting-paid-before-the-project-ends","Getting paid before the project ends",[16,17,18],"p",{},"A web build quoted at $18,000 takes four months. If you invoice once at the end, you're effectively lending the client the cost of a third of a year's work, absorbing every scope change and stall, and betting your cash flow on a single payment that may arrive 30 days after the final sign-off. That's month five before a dollar lands.",[16,20,21],{},"Progress billing fixes this. Instead of one invoice, you break the project into stages and bill for each as you complete it. The client pays as value is delivered; you fund the work as you go. It's the standard model in construction, engineering, and large creative or software projects, and it scales down neatly to a solo freelancer running a $6,000 branding job.",[16,23,24,25,30,31,35],{},"This is different from a one-off ",[26,27,29],"a",{"href":28},"\u002Fhow-to-ask-for-a-deposit-upfront-invoices","deposit invoice"," or a fixed monthly ",[26,32,34],{"href":33},"\u002Frecurring-and-retainer-invoices","retainer",". A deposit is a single upfront payment. A retainer bills a recurring fee regardless of specific deliverables. Progress billing charges incrementally against measurable chunks of one large project as they're finished.",[11,37,39],{"id":38},"how-progress-billing-actually-works","How progress billing actually works",[16,41,42],{},"Every progress-billed project rests on three decisions you make before you start:",[44,45,46,54,60],"ol",{},[47,48,49,53],"li",{},[50,51,52],"strong",{},"The total contract value."," The agreed price for the whole job (or a clear rate structure if it's time-and-materials).",[47,55,56,59],{},[50,57,58],{},"The billing triggers."," What event releases each invoice, a calendar date, a completed milestone, or a percentage of work done.",[47,61,62,65],{},[50,63,64],{},"The schedule of values."," A line-by-line breakdown showing how the total is split across stages.",[16,67,68,69,73],{},"Two broad methods exist for deciding ",[70,71,72],"em",{},"when"," to bill:",[16,75,76,79],{},[50,77,78],{},"Milestone billing."," You invoice when a defined deliverable is complete: \"homepage design approved,\" \"database migration signed off.\" Best when the work has clear, discrete stages. Clients like it because they're paying for something they can see.",[16,81,82,85],{},[50,83,84],{},"Percentage-of-completion billing."," You invoice based on how much of the total work is finished, often assessed monthly. A builder might bill for 40% of a job at the end of month two. This suits long, continuous work where deliverables blur together. It requires an honest, defensible way to estimate \"percent complete,\" which is where disputes usually start.",[16,87,88],{},"Most small-business projects use milestones. They're concrete and hard to argue with.",[11,90,92],{"id":91},"building-a-schedule-of-values","Building a schedule of values",[16,94,95],{},"The schedule of values is the backbone. It's a table, agreed in the contract, that both parties reference for the life of the project. Keep the number of stages sensible: too few and you're back to lump-sum risk, too many and you drown in admin.",[16,97,98],{},"Here's a schedule for that $18,000 website, split into five stages plus a deposit:",[100,101,102,124],"table",{},[103,104,105],"thead",{},[106,107,108,112,115,118,121],"tr",{},[109,110,111],"th",{},"Stage",[109,113,114],{},"Description",[109,116,117],{},"% of total",[109,119,120],{},"Amount",[109,122,123],{},"Trigger",[125,126,127,145,162,177,194,209,226],"tbody",{},[106,128,129,133,136,139,142],{},[130,131,132],"td",{},"0",[130,134,135],{},"Mobilisation deposit",[130,137,138],{},"20%",[130,140,141],{},"$3,600",[130,143,144],{},"On contract signing",[106,146,147,150,153,156,159],{},[130,148,149],{},"1",[130,151,152],{},"Discovery & sitemap approved",[130,154,155],{},"15%",[130,157,158],{},"$2,700",[130,160,161],{},"Client sign-off on IA",[106,163,164,167,170,172,174],{},[130,165,166],{},"2",[130,168,169],{},"Design mockups approved",[130,171,138],{},[130,173,141],{},[130,175,176],{},"Client sign-off on designs",[106,178,179,182,185,188,191],{},[130,180,181],{},"3",[130,183,184],{},"Development complete (staging)",[130,186,187],{},"25%",[130,189,190],{},"$4,500",[130,192,193],{},"Site live on staging server",[106,195,196,199,202,204,206],{},[130,197,198],{},"4",[130,200,201],{},"Testing, revisions, launch",[130,203,155],{},[130,205,158],{},[130,207,208],{},"Site live on production",[106,210,211,214,217,220,223],{},[130,212,213],{},"5",[130,215,216],{},"Retention release",[130,218,219],{},"5%",[130,221,222],{},"$900",[130,224,225],{},"30 days after launch, no defects",[106,227,228,230,235,240,245],{},[130,229],{},[130,231,232],{},[50,233,234],{},"Total",[130,236,237],{},[50,238,239],{},"100%",[130,241,242],{},[50,243,244],{},"$18,000",[130,246],{},[16,248,249,250,253,254,257],{},"Notice stage 5. That's ",[50,251,252],{},"retainage"," (also called retention), a slice of the total held back until after final delivery to guarantee you fix defects. It's ingrained in construction, where 5–10% is typical, and it's increasingly reasonable for larger creative and software work. As the contractor being billed ",[70,255,256],{},"against",", you want retainage low and released quickly; as the party doing the work, you accept it because it reassures a nervous client. State the release condition precisely: \"5% retained, payable 30 days after production launch provided no critical defects remain open.\"",[11,259,261],{"id":260},"what-goes-on-each-progress-invoice","What goes on each progress invoice",[16,263,264],{},"A progress invoice looks like a normal invoice with a few extra fields that show where this payment sits in the bigger picture. Every one should show:",[266,267,268,271,274,277,280],"ul",{},[47,269,270],{},"The overall contract value",[47,272,273],{},"This stage's amount (the \"current claim\")",[47,275,276],{},"Total billed to date, including this invoice",[47,278,279],{},"Total remaining after this invoice",[47,281,282],{},"Any retainage held",[16,284,285],{},"That running tally prevents the most common progress-billing argument: the client losing track of what they've already paid.",[16,287,288],{},"Here's how a stage 2 invoice might read:",[290,291,292,298,339,346],"blockquote",{},[16,293,294,297],{},[50,295,296],{},"Invoice #2026-034","\nProject: Website redesign — Contract value $18,000",[100,299,300,309],{},[103,301,302],{},[106,303,304,307],{},[109,305,306],{},"Line item",[109,308,120],{},[125,310,311,319,327],{},[106,312,313,316],{},[130,314,315],{},"Stage 2: Design mockups approved (20% of contract)",[130,317,318],{},"$3,600.00",[106,320,321,324],{},[130,322,323],{},"Less retainage (5% of this claim)",[130,325,326],{},"–$180.00",[106,328,329,334],{},[130,330,331],{},[50,332,333],{},"Amount due this invoice",[130,335,336],{},[50,337,338],{},"$3,420.00",[16,340,341,342,345],{},"Contract value: $18,000.00\nPreviously billed (stages 0–1): $6,300.00\nThis claim: $3,600.00\n",[50,343,344],{},"Billed to date: $9,900.00 (55%)","\nRetainage held to date: $495.00\nRemaining to bill: $8,100.00",[16,347,348],{},"Payment terms: Net 14. Work on stage 3 begins on receipt.",[16,350,351],{},"Whether you deduct retainage from each claim or hold it all in a final stage is a style choice; both are fine as long as the contract and the invoice math agree. Deducting a little from each claim (as above) is cleaner because the client always sees the running retention figure.",[16,353,354,355,359],{},"Number your invoices in a consistent sequence so the project's billing history is auditable. If you juggle several clients, see ",[26,356,358],{"href":357},"\u002Finvoice-numbering-best-practices","invoice numbering best practices"," for a scheme that won't collapse under multiple projects.",[11,361,363],{"id":362},"contract-wording-that-protects-you","Contract wording that protects you",[16,365,366],{},"Progress billing lives or dies by what's written before work starts. The schedule of values belongs in the signed contract or statement of work, not buried in an email. Include clauses covering:",[16,368,369,372],{},[50,370,371],{},"The trigger definition."," Vague triggers cause disputes. \"Design phase complete\" invites argument; \"Client provides written approval of homepage and two interior page mockups via email or project tool\" does not.",[16,374,375,378,379,383,384,388],{},[50,376,377],{},"Payment terms per stage."," Short terms suit staged work. Net 7 to Net 14 is common; some freelancers use ",[26,380,382],{"href":381},"\u002Fdue-on-receipt-payment-terms","due on receipt"," for deposits and early stages. Whatever you pick, spell out your ",[26,385,387],{"href":386},"\u002Fhow-to-charge-late-fees-on-overdue-invoices","late fee"," policy too.",[16,390,391,394],{},[50,392,393],{},"A stop-work clause."," The single most valuable line in a progress-billing contract:",[290,396,397],{},[16,398,399],{},"\"Work on the subsequent stage will not commence until payment for the preceding stage has been received in full. Timelines extend automatically by any period of delayed payment.\"",[16,401,402],{},"This turns your invoice into a gate. No payment, no progress. It's the natural leverage staged billing gives you, and it beats chasing an $18,000 balance at the end.",[16,404,405,408],{},[50,406,407],{},"Scope-change handling."," When the client adds work mid-project, don't quietly absorb it into an existing stage. Issue a change order that adjusts the contract value and, if needed, adds a stage. Revised schedule of values, signed, then carry on.",[16,410,411,414],{},[50,412,413],{},"Deposit and retainage terms."," State the deposit amount, whether it's refundable, and how it's applied (usually credited against stage 0 or spread across the first stages). State the retainage percentage and its precise release condition.",[11,416,418],{"id":417},"a-worked-cash-flow-comparison","A worked cash-flow comparison",[16,420,421],{},"The point of all this is timing. Same $18,000 project, two approaches:",[16,423,424],{},[50,425,426],{},"Lump-sum, Net 30, invoiced at completion (month 4):",[266,428,429,432],{},[47,430,431],{},"Cash in: $0 until roughly day 150",[47,433,434],{},"You self-fund four months of work",[16,436,437],{},[50,438,439],{},"Progress-billed against the schedule above:",[266,441,442,445,448,451,454,457],{},[47,443,444],{},"Month 0: $3,600 deposit",[47,446,447],{},"Month 1: $2,700 (stage 1)",[47,449,450],{},"Month 2: $3,420 (stage 2, net of retainage)",[47,452,453],{},"Month 3: $4,275 (stage 3, net of retainage)",[47,455,456],{},"Month 4: $2,565 (stage 4, net of retainage)",[47,458,459],{},"Month 5: $2,340 (stage 5 + accumulated retainage $900)",[16,461,462],{},"By the end of month 2 you've collected $9,720 on a project you're only a bit over halfway through delivering. That's the difference between a healthy freelance business and one perpetually one late invoice away from trouble.",[11,464,466],{"id":465},"tax-and-record-keeping-notes","Tax and record-keeping notes",[16,468,469],{},"A few things to get right, and rules vary by jurisdiction, so confirm with your tax authority or an accountant:",[266,471,472,498,504],{},[47,473,474,477,478,482,483,487,488,492,493,497],{},[50,475,476],{},"When to recognise income and charge sales tax\u002FVAT"," usually depends on when each invoice is issued or paid, not on when the whole project finishes. If you're VAT-registered in the UK, each progress invoice is generally a tax point in its own right; see ",[26,479,481],{"href":480},"\u002Fuk-vat-invoices-explained","UK VAT invoices explained",". US sales tax on services varies by state, covered in ",[26,484,486],{"href":485},"\u002Fus-sales-tax-on-invoices","US sales tax on invoices",". Canadian GST\u002FHST has its own ",[26,489,491],{"href":490},"\u002Fcanada-gst-hst-invoice-requirements","invoice requirements",", and Australian ",[26,494,496],{"href":495},"\u002Fwhat-is-a-tax-invoice-australia","tax invoices"," have set fields.",[47,499,500,503],{},[50,501,502],{},"Deposits can be treated differently from progress claims"," for tax purposes in some jurisdictions. Don't assume they're the same.",[47,505,506,509,510,514],{},[50,507,508],{},"Keep every progress invoice, change order, and sign-off email"," for the whole project and beyond. Guidance on ",[26,511,513],{"href":512},"\u002Fhow-long-to-keep-invoices-and-receipts","how long to keep invoices and receipts"," applies here.",[11,516,518],{"id":517},"when-progress-billing-isnt-worth-it","When progress billing isn't worth it",[16,520,521],{},"Skip it for anything short or small. A $900 logo delivered in a week doesn't need five invoices, take a deposit and bill the balance. Progress billing carries admin overhead: more invoices, more approvals, more tracking. The break-even point is roughly a project long enough or large enough that carrying the full cost to completion would strain your cash or your nerves.",[16,523,524],{},"It also demands a client who signs a proper contract and approves stages promptly. If sign-offs are the bottleneck, add a clause deeming a stage approved if the client doesn't respond within, say, five business days. Otherwise your carefully staged cash flow stalls on someone else's inbox.",[16,526,527],{},"Structure the stages, define the triggers in writing, and let each paid invoice unlock the next slice of work. The project funds itself, and you never carry more risk than the current stage.",{"title":529,"searchDepth":530,"depth":530,"links":531},"",3,[532,534,535,536,537,538,539,540],{"id":13,"depth":533,"text":14},2,{"id":38,"depth":533,"text":39},{"id":91,"depth":533,"text":92},{"id":260,"depth":533,"text":261},{"id":362,"depth":533,"text":363},{"id":417,"depth":533,"text":418},{"id":465,"depth":533,"text":466},{"id":517,"depth":533,"text":518},"Invoicing Basics","2026-07-27",null,"A practical guide to milestone and staged invoicing for freelancers and contractors, covering deposits, progress claims, retainage, and sample wording.","md",false,{},true,"\u002Fwhat-is-progress-billing","8 min read",{"title":5,"description":544},{"loc":549},"what-is-progress-billing","1f7Wj81KqhhKD9NyCFT0w5kd8bObLSynWMtfQE4jWeY",[556,984],{"id":557,"title":558,"author":6,"body":559,"category":975,"date":976,"dek":543,"description":977,"extension":545,"featured":546,"meta":978,"navigation":548,"path":490,"readingTime":979,"seo":980,"sitemap":981,"stem":982,"__hash__":983},"content\u002Fcanada-gst-hst-invoice-requirements.md","Canadian GST\u002FHST Invoice Requirements: What to Include (+ Free Template)",{"type":8,"value":560,"toc":965},[561,565,568,571,574,578,589,592,610,622,630,634,637,657,660,738,745,748,760,764,767,772,783,788,799,804,822,825,871,875,878,887,890,893,897,900,922,925,929,935,943,947,962],[11,562,564],{"id":563},"the-invoice-detail-that-decides-whether-your-client-gets-their-tax-back","The invoice detail that decides whether your client gets their tax back",[16,566,567],{},"A Toronto design studio hires you, pays your $2,000 invoice plus tax, and then their bookkeeper tries to claim the HST back as an input tax credit. If your invoice is missing your nine-digit GST\u002FHST number, the Canada Revenue Agency can disallow that credit on audit. Your client eats the cost, and they remember it the next time they pick a contractor.",[16,569,570],{},"That is the practical stakes of a compliant Canadian invoice. It is not just about you charging the right tax. It is about giving the buyer the documentation the CRA requires so the money flows correctly on both sides.",[16,572,573],{},"Here is what actually has to be on the invoice, when you have to register, and how the province of your customer changes the number you charge.",[11,575,577],{"id":576},"do-you-even-have-to-charge-gsthst","Do you even have to charge GST\u002FHST?",[16,579,580,581,584,585,588],{},"You only charge GST\u002FHST once you are registered, and you generally only have to register once you cross the ",[50,582,583],{},"small supplier threshold",": roughly ",[50,586,587],{},"$30,000 in gross taxable revenue over four consecutive calendar quarters"," (or in a single quarter). That figure is long-standing, but confirm the current number with the CRA, because thresholds do change.",[16,590,591],{},"A few points that trip people up:",[266,593,594,597,600,607],{},[47,595,596],{},"The $30,000 is worldwide taxable revenue from your business, not just Canadian sales, and it is gross, not profit.",[47,598,599],{},"The moment you exceed it in a single quarter, you are considered registered on the day of that sale, not at the end of the year.",[47,601,602,603,606],{},"You can ",[50,604,605],{},"register voluntarily"," below the threshold. Freelancers with mostly business clients often do, because it lets them claim input tax credits on their own expenses (software, laptop, home-office share) that would otherwise be sunk cost.",[47,608,609],{},"Zero-rated supplies (exports, basic groceries, certain medical goods) still count toward the threshold even though the rate is 0%.",[16,611,612,613,616,617,621],{},"If you are not registered, you must ",[50,614,615],{},"not"," charge GST\u002FHST, and you must not show a registration number you do not have. Invoice the client for your fee alone. Once you register, you get a GST\u002FHST account number in the format ",[618,619,620],"code",{},"123456789 RT0001",".",[16,623,624,625,629],{},"New to invoicing generally? Start with ",[26,626,628],{"href":627},"\u002Fhow-to-invoice-as-a-freelancer","how to invoice as a freelancer",", then layer the tax rules below on top.",[11,631,633],{"id":632},"the-rate-depends-on-your-customers-province-not-yours","The rate depends on your customer's province, not yours",[16,635,636],{},"This is the part that makes Canada messier than a flat national VAT. Three systems coexist:",[266,638,639,645,651],{},[47,640,641,644],{},[50,642,643],{},"GST only (5%)"," in Alberta, and the three territories.",[47,646,647,650],{},[50,648,649],{},"HST"," (a single blended federal-plus-provincial tax) in Ontario and Atlantic Canada.",[47,652,653,656],{},[50,654,655],{},"GST plus a separate provincial tax"," (PST, RST, or QST) in British Columbia, Manitoba, Saskatchewan, and Quebec.",[16,658,659],{},"Approximate combined rates, which can change, so verify before you invoice:",[100,661,662,672],{},[103,663,664],{},[106,665,666,669],{},[109,667,668],{},"Province",[109,670,671],{},"What you charge",[125,673,674,682,690,698,706,714,722,730],{},[106,675,676,679],{},[130,677,678],{},"Alberta, NT, NU, YT",[130,680,681],{},"5% GST",[106,683,684,687],{},[130,685,686],{},"Ontario",[130,688,689],{},"13% HST",[106,691,692,695],{},[130,693,694],{},"New Brunswick, Newfoundland & Labrador, PEI",[130,696,697],{},"15% HST",[106,699,700,703],{},[130,701,702],{},"Nova Scotia",[130,704,705],{},"14% HST (reduced in 2025 from 15%)",[106,707,708,711],{},[130,709,710],{},"British Columbia",[130,712,713],{},"5% GST + 7% PST",[106,715,716,719],{},[130,717,718],{},"Saskatchewan",[130,720,721],{},"5% GST + 6% PST",[106,723,724,727],{},[130,725,726],{},"Manitoba",[130,728,729],{},"5% GST + 7% RST",[106,731,732,735],{},[130,733,734],{},"Quebec",[130,736,737],{},"5% GST + 9.975% QST",[16,739,740,741,744],{},"Which province applies is decided by the ",[50,742,743],{},"place-of-supply rules",", not by where your desk is. For most services supplied to a business, the place of supply is generally the province of the customer's address that you obtain in the ordinary course of business. Sell a service to an Ontario client and you charge 13% HST even if you live in Calgary.",[16,746,747],{},"PST, RST, and QST are separate provincial regimes with their own registration rules. GST\u002FHST does not automatically cover them. QST in particular runs almost in parallel with GST, administered by Revenu Québec, and if you have a real presence or enough sales in those provinces you may need to register and charge their tax on top. That is a whole second layer worth confirming with an accountant if you sell across borders.",[16,749,750,751,754,755,759],{},"Selling to clients outside Canada is different again. Exports of services are often ",[50,752,753],{},"zero-rated",", meaning you charge 0% but can still recover your input tax credits. See ",[26,756,758],{"href":757},"\u002Fhow-to-invoice-international-clients","how to invoice international clients"," for the mechanics.",[11,761,763],{"id":762},"what-the-cra-requires-on-the-invoice","What the CRA requires on the invoice",[16,765,766],{},"The CRA scales its documentation requirements by the total amount of the sale. These tiers are what a registered buyer relies on to claim input tax credits, so treat the top tier as your default and you will always be safe.",[16,768,769],{},[50,770,771],{},"Sales under $30 — minimum:",[266,773,774,777,780],{},[47,775,776],{},"Your business or trading name",[47,778,779],{},"The date of the invoice",[47,781,782],{},"The total amount paid or payable",[16,784,785],{},[50,786,787],{},"Sales of $30 to $149.99 — add:",[266,789,790,796],{},[47,791,792,793],{},"Your ",[50,794,795],{},"GST\u002FHST registration number",[47,797,798],{},"The amount of GST\u002FHST charged, or a clear statement that the total includes GST\u002FHST, plus an indication of which items are taxable if the invoice mixes taxable and exempt items",[16,800,801],{},[50,802,803],{},"Sales of $150 or more — add:",[266,805,806,813,816],{},[47,807,808,809,812],{},"The ",[50,810,811],{},"buyer's name"," (or trading name, or the name of their authorized agent)",[47,814,815],{},"A description of the goods or services",[47,817,808,818,821],{},[50,819,820],{},"terms of the sale"," (for example, your payment terms)",[16,823,824],{},"Because the top tier is a superset, a good habit is to include everything on every invoice regardless of amount. A complete, defensible Canadian invoice therefore carries:",[44,826,827,837,840,847,850,853,856,859,862,865,868],{},[47,828,829,830,833,834,836],{},"The word ",[50,831,832],{},"Invoice"," and a unique invoice number (see ",[26,835,358],{"href":357},")",[47,838,839],{},"Your legal or trading name, address, and contact details",[47,841,842,843,846],{},"Your GST\u002FHST registration number (",[618,844,845],{},"RT0001"," format)",[47,848,849],{},"The invoice date, and the supply date if different",[47,851,852],{},"The client's name and address",[47,854,855],{},"A line-by-line description of what you supplied",[47,857,858],{},"The subtotal before tax",[47,860,861],{},"The GST\u002FHST shown separately, with the rate and dollar amount",[47,863,864],{},"Any separate PST\u002FQST if you are registered for it",[47,866,867],{},"The total payable",[47,869,870],{},"Payment terms and accepted methods",[11,872,874],{"id":873},"a-worked-example","A worked example",[16,876,877],{},"You are a registered marketing consultant in Vancouver billing a client in Ottawa, Ontario. Place of supply is Ontario, so the rate is 13% HST.",[879,880,885],"pre",{"className":881,"code":883,"language":884},[882],"language-text","INVOICE #2026-041\nDate: 25 July 2026\nFrom: Harbour Marketing (GST\u002FHST #123456789 RT0001)\nTo:   Rideau Software Inc., Ottawa, ON\n\nStrategy workshop (2 days)          $2,400.00\nCampaign copywriting                  $  900.00\n                              Subtotal $3,300.00\n                     HST (Ontario) 13% $  429.00\n                            Total due  $3,729.00\n\nTerms: Net 15. E-transfer or bank transfer.\n","text",[618,886,883],{"__ignoreMap":529},[16,888,889],{},"The math: $3,300 × 0.13 = $429. Your client pays $3,729, records $3,300 as an expense and $429 as an input tax credit they will recover. You collected $429 on the CRA's behalf and will remit it (minus your own ITCs) on your next return.",[16,891,892],{},"Now change the client to Halifax, Nova Scotia. Same $3,300 of work, but HST is 14%, so tax is $462 and the total is $3,762. Same service, different province, different number. This is why place of supply has to be part of your invoicing habit, not an afterthought.",[11,894,896],{"id":895},"zero-rated-vs-exempt-a-common-mix-up","Zero-rated vs exempt — a common mix-up",[16,898,899],{},"They both mean no tax appears as a charge, but they are not the same:",[266,901,902,912],{},[47,903,904,907,908,911],{},[50,905,906],{},"Zero-rated"," (0%): exports, basic groceries, prescription drugs, certain medical devices. You charge 0%, and you ",[70,909,910],{},"can"," still claim input tax credits on related expenses.",[47,913,914,917,918,921],{},[50,915,916],{},"Exempt",": most health and dental services, financial services, residential rent, many educational courses. No tax is charged, and you ",[70,919,920],{},"cannot"," claim ITCs on those expenses.",[16,923,924],{},"If your work falls into an exempt category, you generally do not register or charge GST\u002FHST at all for that activity. If it is zero-rated, you still register (it counts toward the threshold) and still show 0% on the invoice.",[11,926,928],{"id":927},"keep-the-records-to-back-it-up","Keep the records to back it up",[16,930,931,932,934],{},"The CRA can ask you to support both the tax you charged and the input tax credits you claimed. Keep copies of issued invoices and the supplier invoices behind your ITC claims. The general expectation is six years from the end of the tax year they relate to, but confirm the current period. Our guide to ",[26,933,513],{"href":512}," covers the practical filing side.",[16,936,937,938,942],{},"If you make a billing error, do not just delete and reissue. Use a ",[26,939,941],{"href":940},"\u002Fwhat-is-a-credit-note","credit note"," to reverse or adjust the original so your GST\u002FHST records stay auditable.",[11,944,946],{"id":945},"how-this-compares-to-the-rest-of-the-english-speaking-world","How this compares to the rest of the English-speaking world",[16,948,949,950,953,954,957,958,961],{},"The underlying idea is the same value-added-tax logic you will see in the ",[26,951,952],{"href":480},"UK VAT invoice rules"," and the ",[26,955,956],{"href":495},"Australian tax invoice",": the registered seller collects tax, shows their registration number, and the registered buyer reclaims it. Canada's twist is the provincial patchwork of GST, HST, and separate PST\u002FQST regimes. The ",[26,959,960],{"href":485},"US does it differently again",", with sales tax rather than a recoverable credit system.",[16,963,964],{},"Rules and rates in this article vary by province and change over time. Confirm your registration obligation, the correct rate, and the current documentary thresholds with the CRA, Revenu Québec, or a qualified Canadian accountant before you rely on them.",{"title":529,"searchDepth":530,"depth":530,"links":966},[967,968,969,970,971,972,973,974],{"id":563,"depth":533,"text":564},{"id":576,"depth":533,"text":577},{"id":632,"depth":533,"text":633},{"id":762,"depth":533,"text":763},{"id":873,"depth":533,"text":874},{"id":895,"depth":533,"text":896},{"id":927,"depth":533,"text":928},{"id":945,"depth":533,"text":946},"Tax & Compliance","2026-07-25","A Canada-specific guide to CRA invoice rules, GST\u002FHST registration, provincial rate differences, and the exact details clients need to claim input tax credits.",{},"7 min read",{"title":558,"description":977},{"loc":490},"canada-gst-hst-invoice-requirements","EJUTEaNLRcv1M8x_He2vZ-b7bvMqXng5OGq3f66U2po",{"id":985,"title":986,"author":6,"body":987,"category":1416,"date":1417,"dek":543,"description":1418,"extension":545,"featured":546,"meta":1419,"navigation":548,"path":1420,"readingTime":550,"seo":1421,"sitemap":1422,"stem":1423,"__hash__":1424},"content\u002Fwhat-is-a-remittance-advice.md","What Is a Remittance Advice? Meaning, Examples & Free Template",{"type":8,"value":988,"toc":1404},[989,997,1000,1003,1006,1010,1013,1053,1056,1059,1062,1162,1165,1168,1172,1175,1226,1236,1239,1243,1246,1260,1270,1276,1282,1286,1292,1295,1325,1328,1332,1335,1341,1354,1358,1361,1396],[11,990,992,993,996],{"id":991},"the-document-that-tells-you-what-a-payment-was-for","The document that tells you ",[70,994,995],{},"what"," a payment was for",[16,998,999],{},"A lump sum lands in your business account: £4,820.00, reference \"PAYRUN 0714\". You've got six open invoices with that client. Which ones did they just pay? Two in full? Three partial? Did they short-pay one because of a disputed line item?",[16,1001,1002],{},"A remittance advice answers exactly that. It's a note the payer sends alongside (or just before) a payment, itemising which invoices the money covers and how much has been applied to each. It doesn't move any money itself. It's a map that tells you how to allocate the cash that's already on its way.",[16,1004,1005],{},"For freelancers and small businesses, the remittance advice is the quiet workhorse of getting your books to reconcile. Larger clients, government departments, and anyone running a formal accounts-payable process will send one automatically. Smaller clients often don't, which is where you can save yourself hours by asking for one, or by sending a template you'd like them to fill in.",[11,1007,1009],{"id":1008},"what-a-remittance-advice-actually-contains","What a remittance advice actually contains",[16,1011,1012],{},"There's no legally mandated format. It's an administrative courtesy, not a tax document. But a useful one almost always includes:",[266,1014,1015,1021,1027,1036,1042,1047],{},[47,1016,1017,1020],{},[50,1018,1019],{},"Payer's name"," (the business or person paying)",[47,1022,1023,1026],{},[50,1024,1025],{},"Payee's name"," (you)",[47,1028,1029,953,1032,1035],{},[50,1030,1031],{},"Payment date",[50,1033,1034],{},"method"," (bank transfer, cheque, card)",[47,1037,1038,1041],{},[50,1039,1040],{},"Payment reference"," — the string that will appear on your bank statement",[47,1043,1044],{},[50,1045,1046],{},"Total amount paid",[47,1048,1049,1052],{},[50,1050,1051],{},"A line for each invoice being settled",", showing the invoice number, its original amount, any deduction, and the amount applied",[16,1054,1055],{},"The last part is what makes it worth reading. A single payment covering multiple invoices is the norm in accounts-payable batches, and without the breakdown you're guessing.",[1057,1058,874],"h3",{"id":873},[16,1060,1061],{},"Say a marketing agency owes you for three months of retainer work plus one project. On the 14th they run their payment batch and send this:",[100,1063,1064,1082],{},[103,1065,1066],{},[106,1067,1068,1070,1073,1076,1079],{},[109,1069,832],{},[109,1071,1072],{},"Invoice date",[109,1074,1075],{},"Invoice total",[109,1077,1078],{},"Deduction",[109,1080,1081],{},"Amount paid",[125,1083,1084,1100,1114,1130,1145],{},[106,1085,1086,1089,1092,1095,1098],{},[130,1087,1088],{},"INV-0231",[130,1090,1091],{},"30 Apr",[130,1093,1094],{},"£1,500.00",[130,1096,1097],{},"£0.00",[130,1099,1094],{},[106,1101,1102,1105,1108,1110,1112],{},[130,1103,1104],{},"INV-0244",[130,1106,1107],{},"31 May",[130,1109,1094],{},[130,1111,1097],{},[130,1113,1094],{},[106,1115,1116,1119,1122,1124,1127],{},[130,1117,1118],{},"INV-0258",[130,1120,1121],{},"30 Jun",[130,1123,1094],{},[130,1125,1126],{},"£180.00",[130,1128,1129],{},"£1,320.00",[106,1131,1132,1135,1138,1141,1143],{},[130,1133,1134],{},"INV-0261",[130,1136,1137],{},"05 Jul",[130,1139,1140],{},"£500.00",[130,1142,1097],{},[130,1144,1140],{},[106,1146,1147,1149,1151,1153,1157],{},[130,1148],{},[130,1150],{},[130,1152],{},[130,1154,1155],{},[50,1156,234],{},[130,1158,1159],{},[50,1160,1161],{},"£4,820.00",[16,1163,1164],{},"Now the £4,820.00 makes sense. Three retainers and a project, minus £180 knocked off INV-0258. The remittance advice should carry a note explaining that deduction (\"£180 adjustment re: over-billed hours, per email 8 Jul\"). If it doesn't, you now know exactly which invoice to query and by how much, instead of chasing a vague shortfall.",[16,1166,1167],{},"That single deduction line is the reason remittance advices matter. Without one, £4,820 against £5,000 of invoicing just looks like a client who underpaid, and you'd waste a reminder email on money that was deliberately withheld.",[11,1169,1171],{"id":1170},"how-it-differs-from-an-invoice-a-receipt-and-a-statement","How it differs from an invoice, a receipt, and a statement",[16,1173,1174],{},"These four documents get muddled constantly. They flow in a sequence, and each one is issued by a different party at a different moment.",[266,1176,1177,1191,1201,1214],{},[47,1178,1179,1181,1182,1185,1186,1190],{},[50,1180,832],{}," — ",[70,1183,1184],{},"you"," send it to the client to request payment. It creates the debt. (See ",[26,1187,1189],{"href":1188},"\u002Finvoice-vs-receipt","invoice vs receipt"," for the full contrast.)",[47,1192,1193,1196,1197,1200],{},[50,1194,1195],{},"Remittance advice"," — the ",[70,1198,1199],{},"client"," sends it to you to explain a payment they're making. It comes before or with the money.",[47,1202,1203,1181,1206,1208,1209,1213],{},[50,1204,1205],{},"Receipt",[70,1207,1184],{}," send it to the client after the money arrives, confirming payment received. Read ",[26,1210,1212],{"href":1211},"\u002Fhow-to-write-a-receipt","how to write a receipt"," if you issue these.",[47,1215,1216,1181,1219,1221,1222,621],{},[50,1217,1218],{},"Statement of account",[70,1220,1184],{}," send it to show all outstanding invoices and payments over a period. It's a running summary, not tied to one payment. More in ",[26,1223,1225],{"href":1224},"\u002Fwhat-is-a-statement-of-account","what is a statement of account",[16,1227,1228,1229,1232,1233,1235],{},"A clean way to remember the direction: the invoice and receipt come ",[70,1230,1231],{},"from"," the supplier; the remittance advice comes ",[70,1234,1231],{}," the buyer. The remittance advice is the buyer's side of the conversation, the only routine document in the cycle that the customer originates.",[16,1237,1238],{},"One more distinction: a remittance advice is not proof of payment. It states an intention or a completed action, but the payment can still bounce, be recalled, or never actually clear. Your bank statement is the proof. Treat the remittance as a guide to allocation, then confirm against what actually lands.",[11,1240,1242],{"id":1241},"reading-a-remittance-advice-without-getting-caught-out","Reading a remittance advice without getting caught out",[16,1244,1245],{},"A few edge cases trip people up.",[16,1247,1248,1251,1252,1255,1256,1259],{},[50,1249,1250],{},"The reference doesn't match your invoice number."," Big payers often use their own internal reference (a purchase order number, a payment-run ID) rather than your invoice number. Match on the amounts and the invoice numbers ",[70,1253,1254],{},"inside"," the advice, not the bank reference alone. If you use tidy ",[26,1257,1258],{"href":357},"invoice numbering",", this is far less painful.",[16,1261,1262,1265,1266,1269],{},[50,1263,1264],{},"Currency and fees on international payments."," A US client wiring USD to a UK account will send a remittance advice in USD, but the amount that hits your account is in GBP after conversion, minus any intermediary bank fee. The advice might say $2,000; you receive £1,540 after a $15 correspondent fee eats into it. That gap is FX and fees, not a short payment. If you invoice abroad, ",[26,1267,1268],{"href":757},"invoicing international clients"," covers how to word who bears those charges so you're not surprised.",[16,1271,1272,1275],{},[50,1273,1274],{},"Withholding tax deductions."," In some jurisdictions and industries, a client is legally required to withhold a percentage of your payment and remit it to the tax authority on your behalf (construction schemes, certain cross-border payments, some contractor arrangements). A good remittance advice shows the gross amount, the tax withheld, and the net paid. Keep these, they're evidence you can offset that withholding against your own tax bill. Rules vary widely by country and sector, so confirm the treatment with your tax authority or an accountant.",[16,1277,1278,1281],{},[50,1279,1280],{},"Partial payments and part-settled invoices."," If the \"amount paid\" is less than the invoice total with no deduction noted, the invoice is only part-settled. Record the balance as still outstanding, and don't mark the invoice closed.",[11,1283,1285],{"id":1284},"sending-your-own-remittance-advice-when-youre-the-buyer","Sending your own remittance advice when you're the buyer",[16,1287,1288,1289,1291],{},"You're not only on the receiving end. When ",[70,1290,1184],{}," pay a supplier, subcontractor, or software vendor, sending a short remittance advice is a professional habit that speeds up their reconciliation and makes you the client who's easy to work with. It also creates a record on your side of what a given payment covered.",[16,1293,1294],{},"It doesn't need to be fancy. A short email does the job:",[290,1296,1297,1302,1305,1308,1311,1319,1322],{},[16,1298,1299],{},[50,1300,1301],{},"Subject: Remittance advice — payment sent 14 Jul",[16,1303,1304],{},"Hi Sam,",[16,1306,1307],{},"Payment of £960.00 sent today by bank transfer, reference DR-JUL14.",[16,1309,1310],{},"This covers:",[266,1312,1313,1316],{},[47,1314,1315],{},"INV-104 — £480.00 (in full)",[47,1317,1318],{},"INV-109 — £480.00 (in full)",[16,1320,1321],{},"Let me know once it lands. Thanks for the work this month.",[16,1323,1324],{},"Daniel",[16,1326,1327],{},"If you subcontract regularly, a reusable template beats retyping this every time.",[11,1329,1331],{"id":1330},"a-free-remittance-advice-template","A free remittance advice template",[16,1333,1334],{},"Copy this into a document or spreadsheet and fill in the blanks. It works for paying suppliers or for sending to a client who keeps forgetting to tell you what their payments cover.",[879,1336,1339],{"className":1337,"code":1338,"language":884},[882],"REMITTANCE ADVICE\n\nFrom (payer):        [Your business name \u002F address]\nTo (payee):          [Supplier name]\nPayment date:        [DD Mon YYYY]\nPayment method:      [Bank transfer \u002F cheque \u002F card]\nPayment reference:   [Reference as it appears on statement]\n\n------------------------------------------------------------\nInvoice no. | Invoice date | Invoice amount | Deduction | Paid\n------------------------------------------------------------\n[INV-___]   | [DD Mon]     | [0.00]         | [0.00]    | [0.00]\n[INV-___]   | [DD Mon]     | [0.00]         | [0.00]    | [0.00]\n------------------------------------------------------------\n                                    TOTAL PAID: [0.00]\n\nNotes: [Reason for any deduction, e.g. agreed discount,\n        disputed line, withholding tax]\n",[618,1340,1338],{"__ignoreMap":529},[16,1342,1343,1344,1348,1349,1353],{},"If you build invoices in a spreadsheet already, the ",[26,1345,1347],{"href":1346},"\u002Fhow-to-make-an-invoice-in-excel-word-google-docs","make an invoice in Excel, Word or Google Docs"," approach adapts cleanly to this layout, and pairs well with the ",[26,1350,1352],{"href":1351},"\u002Fbest-free-invoice-templates-for-freelancers","free invoice templates"," you may already use.",[11,1355,1357],{"id":1356},"using-remittance-advices-to-reconcile-faster","Using remittance advices to reconcile faster",[16,1359,1360],{},"The practical payoff is at month-end. A tidy process:",[44,1362,1363,1369,1375,1381,1387],{},[47,1364,1365,1368],{},[50,1366,1367],{},"File every remittance advice"," you receive in the same place as the related invoices. Digital folder, email label, or attached to the invoice record in your accounting software.",[47,1370,1371,1374],{},[50,1372,1373],{},"When a deposit lands",", pull the matching remittance advice and allocate the payment across the listed invoices exactly as stated.",[47,1376,1377,1380],{},[50,1378,1379],{},"Flag any gap"," between the advice total and what actually cleared. FX and bank fees explain most; anything else is a query to raise.",[47,1382,1383,1386],{},[50,1384,1385],{},"Only mark an invoice paid"," once the money has cleared, not when the advice arrives. The advice is a promise; the bank statement is the fact.",[47,1388,1389,1392,1393,1395],{},[50,1390,1391],{},"Keep them as long as the underlying invoices",", since they explain deductions you may need to justify later. General guidance on retention lives in ",[26,1394,513],{"href":512}," — periods vary by jurisdiction, so check your local rules.",[16,1397,1398,1399,1403],{},"Clients who send clean remittance advices are usually clients who pay on time; the two habits travel together. If you're dealing with the opposite, an advice that never arrives and a payment that never lands, the practical playbook is in ",[26,1400,1402],{"href":1401},"\u002Fwhat-to-do-when-a-client-wont-pay","what to do when a client won't pay",". But for the well-run accounts-payable clients that make up most of a healthy client list, the remittance advice is the small document that turns a mysterious bank deposit into a reconciled, closed-off set of invoices in under a minute.",{"title":529,"searchDepth":530,"depth":530,"links":1405},[1406,1408,1411,1412,1413,1414,1415],{"id":991,"depth":533,"text":1407},"The document that tells you what a payment was for",{"id":1008,"depth":533,"text":1009,"children":1409},[1410],{"id":873,"depth":530,"text":874},{"id":1170,"depth":533,"text":1171},{"id":1241,"depth":533,"text":1242},{"id":1284,"depth":533,"text":1285},{"id":1330,"depth":533,"text":1331},{"id":1356,"depth":533,"text":1357},"Document Types","2026-07-23","A remittance advice is the slip a payer sends to confirm what an incoming payment covers. Here's how to read one, send one, and use it to match payments.",{},"\u002Fwhat-is-a-remittance-advice",{"title":986,"description":1418},{"loc":1420},"what-is-a-remittance-advice","meY_hWL1UEOTjpjhYxOTBDYPXFp627EkxJz1UGn-VFo",1785145879365]