Progress billing is invoicing a project in stages as the work is completed, instead of one invoice at the end. The total is set up front, often in an estimate or contract, and each invoice bills a percentage of the work done, a finished milestone or specific line items. It is common in construction, consulting and other long projects. It differs from a payment plan, which splits a fixed price into scheduled payments regardless of progress. QuickBooks Online calls it progress invoicing and builds the invoices from an accepted estimate.
What is progress billing?
Progress billing, also called progress invoicing, bills a single job in parts. You agree the total first. Then you invoice as each part of the work is done, until the total has been billed. The customer pays for work as it happens instead of waiting for one large bill at the end.
How do you split the invoices?
- By percentage complete. Bill the share of the total that matches the share of work done.
- By milestone. Bill a set amount when a defined stage is finished.
- By line item. Bill the specific products or services delivered so far.
A worked example
A $30,000 project, billed by percentage complete, with a 10% deposit.
| Stage | Billed to date | This invoice |
|---|---|---|
| Deposit at signing (10%) | $3,000 | $3,000 |
| 40% complete | $12,000 | $9,000 |
| 75% complete | $22,500 | $10,500 |
| Finished (100%) | $30,000 | $7,500 |
Each invoice bills the share of the total earned so far, minus what was already billed. At 40% complete, 40% of $30,000 is $12,000. The deposit already billed $3,000, so the invoice is $9,000. The four invoices add up to the total: $3,000 + $9,000 + $10,500 + $7,500 = $30,000.
How is progress billing different from a payment plan?
| Progress billing | Payment plan | |
|---|---|---|
| What sets each amount | Work completed | A schedule agreed up front |
| Dates | When stages finish | Fixed dates |
| Total | Can change with change orders | Fixed |
| Common for | Projects | Programs, treatment, services sold at one price |
A payment plan splits a known price over time. Progress billing ties each bill to delivered work.
How does progress invoicing work in QuickBooks Online?
From QuickBooks Online's support article:
- What it does. "Progress invoicing lets you split an estimate into as many invoices as you need."
- Turning it on. In Account and settings, on the Sales tab, turn on "Create multiple partial invoices from a single estimate."
- It starts from an estimate. The estimate must be marked Accepted. Creating progress invoices "doesn't change the original estimate, which remains in your records."
- Three ways to invoice. The entire estimate, a percentage of the work done, or by line item.
- Tracking it. The Estimates & Progress Invoicing Summary by Customer report lists estimates and their connected progress invoices.
What should progress billing terms say?
- How each stage is measured and who confirms it is done
- When each invoice is due, such as net 30 from the invoice date
- How a deposit is credited against later invoices
- How change orders adjust the total
Every figure on this page was checked against these sources on Oct 6, 2026. General information, not legal or tax advice.