How do Deposits work?
FreshBooks has the ability for you to easily request a percentage of your Invoice to be paid upfront as a Deposit. Deposits allow you to specify the amount to be paid. If you’re looking to allow your Clients the option to choose the amounts they pay on your Invoices, you can check out Partial Payments here instead.
To add a Deposit to an Invoice, follow these steps:
- Create your Invoice as usual
- At the bottom where the Subtotal is, click on the Request a Deposit link
- Enter in your percentage for the Deposit
- Click away, and the Deposit Due will calculate appropriately
- You can then continue working on your Invoice, save or send it to your Client.
When your Client receives an Invoice with a Deposit on it, they’ll see a Deposit Due banner:
Once the Deposit is paid, the banner changes to Deposit Paid:
This makes it easy for your Client to know exactly what’s due on the Invoice, so they can begin making payment on the remaining balance.
Do late payment reminders work on Invoices with Deposits?
Yes they do! Invoices with a Deposit will still trigger the late payment reminder emails on whichever schedule you’ve set up. Note that the reminder will go out based on the Date of Issue on the Invoice, regardless of when the Deposit was entered.
Can I make multiple Deposits per Invoice?
Currently you can only have one Deposit set per Invoice. After this you can use our Partial Payments feature so that your Client can pay the rest of the Invoice in multiple payments online. You can always also add any offline payments manually to apply further payments.
How do Deposits factor into my Reports?
Deposits in FreshBooks are considered liabilities until further payment has been added on the Invoice. As they are not initially considered revenue, they will not show up in these Reports: Revenue By Client and Profit and Loss (Billed method) until further payment has been entered on the Invoice beyond the Deposit. Deposit Invoices will immediately show up on these Reports: Payments Collected (when Deposit payment is received), Tax Summary, and Accounts Aging.
How is tax factored into Deposits?
When you set a Deposit, the percentage that is set is calculated based on the Invoice total before tax. So if you had a $113 Invoice (with $13 being tax) and asked for a 50% Deposit, the Deposit would set to $50.
If I also allow my Clients to make Partial Payments, will they be able to pay just a portion of the Deposit?
If a Client is paying online, they will be required to pay the full Deposit amount. Once the Deposit has been paid though, the Client can make partial payments against the remaining Invoice balance.
Can I set a Deposit amount on the mobile app?
At this time, you can only set Deposits on the web-based version of FreshBooks.