Asking for a deposit: how much, how to word it, and the deposit invoice

A deposit is part of the fee that the client pays before the project starts. It gives the service provider planning certainty and shows the project is serious. For the client, it's an advance of trust, since they pay before they have anything in hand.

How large is a typical deposit?

There's no fixed rule – both sides agree the amount freely. In practice, values between a quarter and half of the project volume are common. The more upfront effort before the first visible delivery, the more a higher deposit makes sense.

Example: for a €6,000 project, a 30% deposit comes to exactly €1,800. The rest becomes due on completion or in further stages.

How to word the deposit in your quote

"A deposit of 30% (€1,800) is due upon awarding the contract. Work begins once the deposit is received. The remaining €4,200 is due after acceptance."

What belongs on a deposit invoice?

  • labeled as a "deposit invoice" and referencing the quote or order
  • the usual mandatory invoice details (number, date, addresses, tax number or VAT ID)
  • the deposit amount and VAT, where applicable
  • a note that the deposit will be credited against the final invoice

Deposit, progress payment, payment in advance: the difference

  • Deposit: an amount paid before the project starts, usually a percentage
  • Progress payment: payment for a project stage already delivered
  • Payment in advance: the full amount paid before the work is done

Fairer for both: securing the budget instead of a deposit

Many clients hesitate over a deposit because the money goes straight to the service provider. With a stip, the client secures the budget with the payment partner Stripe before the project starts. You can see the money is there, and you receive it after each milestone is approved. The client only pays for what they've accepted.

Frequently asked questions

Do I need to charge VAT on a deposit?+

In many cases yes, as soon as the deposit is received. The details depend on your tax status, so it's best to check with your tax advisor.

What happens to the deposit if the project is cancelled?+

That's governed by your contract. Without an agreement, it depends on the circumstances – which is why it's worth briefly describing this case in the quote.

Is a 50% deposit too much?+

Not necessarily – with high upfront effort, that's reasonable. What matters is that the client understands what they're paying for.

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General information only; not legal or tax advice.