Set clear milestones, invoice on time, and keep cash flowing. A simple progress billing guide for Canadian contractors with steps, examples, and templates.
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Progress billing keeps your cash flowing during a job, not just at the end. If you’ve ever floated materials for 30 days or chased a final cheque for weeks, you know the pain. This guide shows you how to set progress billing up the right way. You’ll learn how to break work into clear milestones, write a simple schedule of values, and invoice on time. We keep it practical, with steps you can follow today. Use this on renovation projects, service upgrades, or new builds. It fits solo trades and larger crews.
Progress billing splits your project price into staged payments tied to clear milestones. You set a schedule of values, define pass/fail checks, and invoice as work is completed. This keeps materials funded, labour covered, and disputes down. Clients see progress, you keep momentum.
Progress billing means you get paid as work moves forward. It’s common on jobs longer than 2–3 weeks. It’s also helpful on smaller jobs with heavy material costs.
Here’s the simple flow:
In general, a common pattern is 30/40/30 across start, mid, and final. But don’t copy a template blindly. Tie amounts to real work and real costs. Heavy material phase? Front-load a bit to cover it. Light finish phase? Keep that draw smaller.
If you’re also looking to streamline [professional proposals], our guide covers structure and wording that set clear expectations from day one.
A schedule of values (SOV) is your billing map. It shows what each part of the work is worth.
Build it in 5 steps:
Tips that help:
This pairs well with understanding [invoice templates] so each draw looks consistent and professional.
Clients pay faster when they can see the work is done. Make milestones visible and simple.
Good examples:
Use pass/fail checks:
Put timelines next to milestones. Example: “Rough-in target: day 10.” Dates help everyone plan. If a check fails, list a 48-hour fix window. Keep it clear and calm.
For contractors dealing with [project timelines], we recommend laying out your week-by-week plan so draws line up with actual crews on site.
You need proof that a milestone is done. Keep it simple:
Send the milestone summary with your invoice. One page is fine. Clear photos win arguments.
Tools like Donizo help here. You can send a branded proposal, get e-signatures for acceptance, and keep all notes in one place. When the client approves a milestone, you have a clean trail.
If you need help with changes, see our advice on [change orders] to avoid billing confusion when the scope shifts.
Pick a rhythm and stick to it. Consistency builds trust.
Common patterns:
Set two timeframes in your contract:
In many Canadian provinces, a 10% statutory holdback applies under lien laws. Reflect that as a separate line on each invoice. Release it after the required period, once no liens are claimed. Always follow your province’s rules.
Platforms such as Donizo can convert an accepted proposal into an invoice in one click. That saves 2–3 hours per week and keeps formatting consistent across all draws.
Delays happen. Weather. Backorders. Hidden damage. Don’t let them wreck your billing plan.
Use these steps:
When there’s a dispute:
Strong documentation solves most problems fast. It also protects your margin.
Start with your actual cost curve. Front-load material-heavy phases. In general, many contractors use a 30/40/30 pattern across start, mid, and final. Adjust it to match real work. The goal is simple: your cash in should cover your cash out.
Yes. If materials are pricey or the job runs more than 1–2 weeks, use two draws: a start payment to cover materials, and a final on completion. Keep it simple and clear.
Many provinces require a 10% statutory holdback under lien laws. Show it as a separate line on each invoice. Release it only after the legal period and lien checks. If you’re unsure, ask a local construction lawyer or your accountant.
Stay calm and factual. Share your photos, notes, and inspection results. Offer a quick fix plan. If needed, split the milestone and bill the undisputed portion now. Document the rest and set a 48-hour recheck.
Often, yes. If materials are a big chunk, bill them when ordered or delivered. Show receipts and delivery photos. This reduces risk and keeps the schedule moving.
Progress billing keeps your projects steady and your cash healthy. Break work into clear milestones, show simple pass/fail checks, and invoice on a set rhythm. That reduces stress, speeds payments, and builds trust.
Next steps:
To streamline proposals, e-signatures, and invoicing, tools like Donizo can help. Put this system in place now, and finish every job strong and paid.
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