Invoice Calculator
Work out an invoice total from hours and rate or a flat fee, with discount, sales tax, reimbursed expenses, a deposit already taken and a late-fee rate — applied in the order that keeps the tax base correct.
About this calculator
Getting an invoice total right depends on applying each adjustment in the correct order, and this calculator follows the sequence real bookkeeping does. The billable work — hours times rate, or a flat project fee — is totaled first, and the discount is subtracted from that work amount alone, since a discount is normally a price concession on the service itself, not on pass-through costs. Reimbursed expenses like materials or travel are then added at cost, and sales tax or VAT is assessed on the discounted work plus expenses only if the jurisdiction treats reimbursed costs as part of the taxable supply, controlled by a toggle.
That produces the invoice total, and any deposit already collected is subtracted to reach the balance due, capped so an overpaid deposit never produces a negative balance. A late fee percentage, applied monthly to whatever balance remains unpaid past the payment terms, rounds out the picture for tracking overdue accounts. This model assumes a single tax rate and a single discount applied uniformly to the whole invoice — it doesn't handle line-item-specific tax treatment or tiered discounts across multiple services.
Inputs
Results
Invoice total
$1,500.00
≈ 12 pairs of sneakers
Balance due
$1,500.00
≈ 12 pairs of sneakers
How to Use This Calculator
- Choose whether you are billing hourly or a flat fee, and enter the amount.
- Add any reimbursed expenses — these are passed through at cost and usually sit outside the tax base.
- Set the discount and tax rate; the discount is applied before tax is assessed.
- Enter any deposit already received to see the balance actually due.
How the result changes with Hours billed
| Hours billed | Invoice total | Balance due |
|---|---|---|
| 10 | $750.00 | $750.00 |
| 15 | $1,125.00 | $1,125.00 |
| 30 | $2,250.00 | $2,250.00 |
| 50 | $3,750.00 | $3,750.00 |
What each input means
- Billing basis
- Bill by the hour or as a single flat fee.
- Hours billed
- Total billable hours. Used when billing hourly.
- Hourly rate
- Your rate per hour.
- Flat fee
- Agreed project fee. Used when billing a flat fee.
- Reimbursed expenses
- Pass-through costs billed at cost — materials, travel, subcontractors.
- Discount
- Applied to the work, before tax.
- Sales tax / VAT rate
- Your jurisdiction's rate. Leave at 0 if the service is not taxable.
- Tax the expenses too
- Some jurisdictions treat reimbursed expenses as part of the taxable supply.
- Deposit already paid
- Retainer or deposit the client has already sent.
- Payment terms (days)
- Net terms — 30 means payment is due 30 days from the invoice date.
- Late fee per month
- Monthly charge on an overdue balance. 1.5% per month is the common contractual figure.
What each result means
- Invoice total
- Work after discount, plus expenses, plus tax.
- Balance due
- Invoice total less any deposit already held.
- Work subtotal
- Before discount.
- Taxable base
- The amount tax is actually assessed on.
- Deposit applied
- Capped at the invoice total — a larger deposit leaves a zero balance, not a negative one.
- Late fee per month
- Charged on the unpaid balance.
- Effective hourly rate
- Discounted work divided by hours billed.
How this is calculated
Formula
total = work × (1 − discount) + expenses + tax; balance due = total − depositWorked example, using the default values
- Total the workwork = hours × rate20 h × $75 = $1,500
- Apply the discount to the work onlydiscounted work = work × (1 − discount%)$1,500 × (1 − 0%) = $1,500 (−$0)
- Assess tax on the taxable basetax = discounted work × rate$1,500 × 0% = $0
- Add expenses and tax for the invoice totaltotal = discounted work + expenses + tax$1,500 + $0 + $0 = $1,500
- Subtract any deposit already heldbalance due = total − deposit$1,500 − $0 = $1,500 due in 30 days
Engine last updated . Built by Paul Gunder, a software engineer, not a licensed financial, medical, or legal professional.
Frequently Asked Questions
Why is the discount applied only to the work, not to reimbursed expenses?
A discount is normally a concession on the price of the service itself, while reimbursed expenses like materials or travel are pass-through costs billed at what was actually spent. Discounting an expense would mean eating part of a cost that was never marked up in the first place, which is why this calculator keeps the two separate.
What happens if my deposit is larger than the total invoice?
The applied deposit is capped at the invoice total, so the balance due settles at zero rather than going negative. Any deposit amount beyond the invoice total isn't automatically carried forward or refunded by this calculator — that needs to be tracked and handled separately in your accounting.
Should reimbursed expenses on this invoice be taxed?
That depends entirely on the jurisdiction and the nature of the expense — some tax authorities treat pass-through costs as part of the taxable supply while others don't. The Tax the Expenses Too toggle lets you switch between the two treatments, but confirming which rule applies to your situation is worth checking with a tax professional or your local tax authority.
How is the monthly late fee applied to an overdue balance?
It's calculated as a percentage of whatever balance remains unpaid, applied per month past the agreed payment terms, with a per-day figure also shown for prorating a partial month. The 1.5% default reflects a commonly used contractual rate, but the actual fee only applies if your client agreement specifies one.
Does Payment Terms (days) affect the invoice total or late fee shown?
No. Payment terms is used to label the due date on the invoice — it doesn't factor into the invoice total, balance due, or the late fee amount, which is a flat monthly rate applied to the balance rather than something the calculator prorates against days elapsed since the invoice date.
Related Calculators
The questions that sit next to this one — chosen by subject, including calculators filed under a different category.
Freelance Rate Calculator
Calculate your ideal freelance hourly rate based on desired salary, expenses, taxes, and billable hours. Ensure you're pricing your services correctly.
HR & PayrollBillable Hours Calculator
Track billable vs non-billable hours and calculate weekly, monthly, and annual revenue. Optimize your billing rate.
Small BusinessDiscount Calculator
Calculate discounted prices, savings amount, and discount percentage. Perfect for sales and pricing.
Small BusinessSales Commission Calculator
Calculate sales commission earnings including base salary, commission rate, and quota bonuses. See total earnings and quota achievement.
More in Business & Entrepreneurship.