InvoiceKitQuick answer: A contractor invoice separates labor (hours × rate or a fixed price) from materials (at cost or with markup), adds extras such as disposal or permits, applies sales tax where required, and states when payment is due.
Labor vs materials
Show labor and materials as separate lines. Clients trust itemised invoices more, and in many US states materials are taxed differently from labor. If you mark up materials, show the marked-up price as the rate. You don't have to show the markup percentage.
Progress billing for larger jobs
- Agree milestones in your estimate (for example 30% at start, 40% at rough-in, 30% on completion).
- Invoice each milestone as its own numbered invoice, describing the stage completed.
- On the final invoice, list change orders separately, each with its own line.
Change orders
Any extra work the client asks for should appear as a separate line, for example “Change order #2: add 3 outlets in garage”. That makes the final total easy to check against the original estimate.
FAQ
Do contractors charge sales tax on labor?
It depends on the state or country. Many US states tax materials but not labor on repairs. Others tax both. Check your local rules or ask an accountant.
Should I list my license number on the invoice?
Many states require licensed contractors to show their license number on invoices and estimates. Put it in the From box.
What payment terms are normal for contractors?
Due on completion is common for small jobs. Larger projects use deposits and progress payments.
More invoice templates
Last updated · Written by the MiniTools team. This page is general information, not tax or legal advice.