TOOLS / CONTRACTOR INVOICE TEMPLATE
Free templateFree contractor
invoice template
A contractor invoice template built for how construction billing actually works — including the retainage line most generic invoice templates for contractors leave out entirely. Works as a subcontractor invoice template or a straight construction invoice template, whichever end of the job you're on.
Both files use the same layout — download whichever one you'll actually use. No email required for either.
What's in it
- Line items with quantity, rate and auto-calculated amount
- Subtotal and sales tax
- An optional retainage line that calculates what's held back
- Payment terms and a remit-to block
- Working formulas in the Excel version — type in numbers, it adds up
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What a contractor invoice needs
to get paid without a follow-up
Most late payments aren't a dispute about the work — they're an invoice that got kicked to the bottom of a pile because something on it didn't match what accounts payable needed to process it. AP departments, especially on the general contractor side, tend to process what's complete and set aside what isn't, rather than chasing you for the missing piece.
A job name or PO number matters more than it looks like it should. Without one, your invoice can't be matched to a budget line or a contract, and matching it manually is exactly the kind of task that gets deferred to "later" on a busy desk.
The description of work matters too, specifically how much detail it has. "Electrical — Phase 2" tells an approver less than "Rough-in wiring, 2nd floor units 201–208, per contract line 4.2" — and the second version is far less likely to trigger a callback asking what was actually done.
Every invoice needs
- Your business name and remit-to details
- Client name and job site address
- Invoice number, invoice date and a job/PO number
- Line items with quantity, rate and description
- Subtotal, tax, and retainage if the contract has it
- Total due and payment terms with a due date
Progress billing
vs. fixed-fee invoicing
Fixed-fee (lump-sum) invoicing bills the agreed price at defined points — a deposit, a milestone, completion — or as one invoice when the job is done. It's simple, and it's what this template is built for directly: fill in the line items, apply retainage if it applies, send it.
Progress billing is different, and it's standard on larger or longer jobs. Instead of billing a flat milestone amount, you bill the percentage of the total contract value equal to the percentage of work actually completed to date, tracked against a schedule of values — the contract broken into line items (site work, framing, electrical, finishes) each with its own budgeted amount. Every billing period you calculate percent complete per line, multiply by that line's value, subtract what's already been billed, and invoice the difference.
This template handles progress billing fine for straightforward jobs — bill the percentage complete, apply retainage, done. Where a general contractor requires a formal schedule of values with per-line percent-complete tracking, that's usually an AIA G702/G703-style form instead, because it's often a contractual requirement rather than a preference. Worth confirming before you invoice the first payment application, not after it's rejected.
Fixed-fee works when
- The job has a flat price or clear milestones
- There's no formal schedule of values in the contract
- The GC or client hasn't specified a required format
- The job is short enough that one or two invoices cover it
Retainage on the invoice,
and how it's tracked in the books
On the invoice itself, retainage is simple: a line that reduces what's due now. A $20,000 invoice with 10% retainage shows a $2,000 deduction, leaving $18,000 due today — the remaining $2,000 isn't waived, it's deferred until the contract's retainage terms release it, typically at substantial completion.
In the books, that $2,000 should not sit in ordinary accounts receivable next to money that's simply due on normal terms. It belongs in a separate retainage receivable account, because it ages completely differently — it doesn't become "overdue" the way a normal invoice does, it just sits until the contractual release condition is met, which could be months away. Blending it into regular AR overstates how collectible your near-term receivables actually are, and understates how much cash is genuinely tied up in retainage across your active jobs.
The same logic runs in the other direction if you hold retainage on your own subcontractors — that belongs in retainage payable, separate from ordinary accounts payable, for the same reason. We cover this in more depth, including how retainage is capped by contract and increasingly by state law, on our construction bookkeeping page.
Getting this split right once is easy. Keeping it right every month — as new invoices go out, new retainage gets held, and old retainage finally releases — is the part that actually needs a process, which is exactly what's included in monthly bookkeeping rather than something to reconstruct at tax time.
Worked example
- Invoice subtotal: $20,000
- Retainage held (10%): −$2,000
- Amount due now: $18,000
- The $2,000 moves to retainage receivable, not written off
- It releases at substantial completion or contract closeout
What net 30 actually
costs you in cash flow
"Net 30" means payment is due 30 days after the invoice date — not 30 days after the client feels like paying, though in practice plenty of clients treat it that way. Every day between finishing the work and actually collecting the cash is a day your business has already paid for labor and materials out of its own working capital, without being reimbursed yet.
Stack retainage on top of net 30 and the gap compounds. Take that same $20,000 invoice with $2,000 held as retainage: $18,000 is collectible on net-30 terms, and the remaining $2,000 is collectible only much later, at closeout. If the client pays on day 30 as agreed, you've financed $18,000 of already-completed work for a month. If they pay on day 45 — common enough that it's barely worth calling unusual — that's 45 days of financing, for free, provided by you to your client.
To put a number on it: financing $18,000 for 45 days at an illustrative 10% annual cost of capital — a placeholder rate for illustration, not a rate we're claiming as typical for any specific lender — works out to roughly $18,000 × (10% ÷ 365) × 45 ≈ $222. That's not a huge number on one invoice, but multiply it across every invoice outstanding on every active job, and it becomes a real, ongoing cost of doing business on terms you may not have had to accept. Shorter terms, an upfront materials deposit on larger jobs, or simply invoicing the moment work is complete rather than at the end of the week all shrink that gap directly.
What shrinks the gap
- Invoicing immediately on completion, not batched weekly
- Net 15 instead of net 30, where you can negotiate it
- An upfront deposit for materials on larger jobs
- Following up the moment an invoice goes past due, not a month later
Common reasons invoices
get held up in construction AP
Missing job or PO number
Without one, AP can't match the invoice to a budget line or contract, and it gets set aside rather than processed.
No lien waiver attached
Many GCs won't release payment without a signed conditional or unconditional waiver, especially on commercial jobs.
Doesn't match the schedule of values
If the contract has a schedule of values, an invoice that doesn't reference the same line items gets bounced back for correction.
Missing backup for T&M work
Time-and-materials billing usually needs signed tickets or daily reports attached, not just a total.
Retainage math doesn't reconcile
If the held-back amount doesn't match what the GC's own numbers expect, the invoice gets flagged rather than paid.
Wrong contact or wrong portal
Many GCs require submission through a specific AP contact or portal — sent the normal way, it can sit unseen for weeks.
Contractor invoice
template questions
Your business name and remit-to details, the client's name and job address, an invoice number and date, a job or PO number if the client uses one, a clear description of the work with quantities and rates, the subtotal, any tax, retainage held if your contract has a retainage clause, the total due, and payment terms with a due date. Missing any one of these is a common reason invoices sit unpaid in a stack rather than getting rejected outright — nobody tells you it's wrong, it just doesn't get processed.
Yes. Download it, remove our name from the footer if you want, and use it for as many clients and jobs as you like. There is no watermark, no locked cells you need a password for, and no catch.
Yes, in the Excel version. There's a retainage percentage cell that calculates the amount held back and subtracts it from the total due. Leave it at zero if your contract has no retainage clause, or delete the row entirely if you'd rather it not show at all.
The format is the same. The difference is who you're billing: a contractor invoice usually goes to the property owner or client directly, while a subcontractor invoice goes to the general contractor, and often needs to reference the GC's PO or job number and match their schedule of values. Both use this same template — just fill in the job block with whichever party you're actually billing.
It works fine for straightforward progress payments — bill the percentage of the job completed, apply retainage, done. On larger commercial jobs where the GC requires a formal schedule of values with per-line-item percent-complete tracking, you'll usually need an AIA G702/G703-style format instead, since that's often a contractual requirement rather than a preference.
An editable Excel workbook (.xlsx) with working formulas for the line items, tax and retainage, and a clean PDF version if you just want to print it or fill it in by hand.
Invoicing isn't the hard part.
Getting paid on time is.
If invoices are going out fine but the cash still isn't showing up when it should, that's usually a bookkeeping and follow-up problem, not an invoicing one. Thirty minutes, no pitch — we'll look at what's actually happening.
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