How do I invoice clients for combined hourly and flat-fee work in the US?

Understanding combined hourly and flat-fee invoicing

Invoicing clients for a project that includes both hourly work and flat-fee work is extremely common in the US. A freelancer might charge a flat fee for a defined deliverable (like a website audit, a logo package, or a discovery workshop) and also bill hourly for ongoing support, revisions, consulting calls, or additional tasks that fall outside the original scope. Agencies do this too: a flat project fee covers the “base build,” while hourly time is used for changes, integrations, content updates, or training.

The challenge is not whether you can do it—you absolutely can—but how to present it clearly so clients understand what they’re paying for, you get paid on time, and the invoice is easy to reconcile. A combined invoice should feel simple to a client reading it at a glance while still being detailed enough to answer questions like: What was included in the flat fee? What hourly work was performed? How many hours were billed? What time period does it cover? Are expenses included? How do taxes apply?

This guide walks through practical approaches to combined hourly and flat-fee invoicing in the US, with formatting examples and policies you can adopt. It’s designed so you can apply it directly in your invoicing workflow, including using an app like invoice24 that supports line items, descriptions, time entries, discounts, taxes, deposits, partial payments, and notes.

Why clients like combined billing (when it’s done right)

Clients generally don’t mind mixed billing. In fact, many prefer it because it aligns cost with reality: they get predictable pricing for the core deliverable, and flexibility for extras. The problem occurs when the invoice doesn’t explain the split, or when the hourly items appear to be “double charging” for work the client assumed was included in the flat fee.

When you invoice correctly, combined billing can increase trust. Flat-fee work communicates confidence and simplifies budgeting. Hourly billing communicates transparency and fairness for variable, client-driven work. Together, they create a balanced model that protects both parties—especially when scope changes or priorities evolve mid-project.

Start with the contract: define what’s flat-fee vs hourly

The invoice is a billing document, not the place to renegotiate expectations. The cleanest invoices come from clean agreements. Before you ever send a combined invoice, your proposal or contract should clearly define:

1) The flat-fee deliverables. List what the client gets for the fixed price. Include specifics like number of pages, number of concepts, rounds of revisions included, project phases included, and what “done” means.

2) Hourly services and triggers. Define the hourly rate and what types of tasks are billed hourly. Common examples include additional revisions beyond what’s included, meetings beyond an included allotment, support after launch, content entry, rush work, scope additions, and troubleshooting third-party tools.

3) Scope boundaries and change control. Include language that clarifies that any work outside the fixed scope will be billed hourly (or quoted separately). A simple process helps: you notify the client when something is outside scope, estimate hours, get approval, then proceed.

4) Billing schedule. Decide whether you invoice weekly, biweekly, monthly, by milestone, or at completion. Combined billing works especially well on milestone invoices: the flat fee can be tied to the milestone, and hourly items cover the variable work during that time window.

5) Payment terms and late fees. In the US, standard terms are Net 7, Net 14, or Net 30. If you charge late fees, put the policy in the agreement and reiterate it on the invoice.

When your agreement is clear, your invoice becomes a simple reflection of it: one section for the flat fee, one for hourly items, and a total that makes sense.

Choose the right invoice structure: two proven layouts

There are two common ways to format combined hourly and flat-fee work on an invoice. Both work well. Choose the one that best matches your clients and industry.

Layout A: Separate sections (most client-friendly)

This approach groups flat-fee line items together and hourly line items together. The client immediately sees the fixed portion of the bill and the variable portion. It’s easy to scan and reduces confusion.

Example structure:

Section 1: Flat-fee services

Section 2: Hourly services (with date range and descriptions)

Section 3: Expenses (optional)

Totals: Subtotal, discounts, taxes, payments received, balance due

Layout B: Timeline-based with mixed lines (best for ongoing engagements)

This approach lists everything in chronological order. It can be helpful when the client wants an audit trail of activity. It’s common for consultants who bill monthly: they might include a monthly flat retainer and then list hourly items below it by date.

Example structure:

Line 1: Monthly retainer (flat fee)

Line 2+: Dated hourly entries (calls, troubleshooting, edits)

Line N: Expenses

Totals

If you worry about clarity, use Layout A. If your client expects a time-based narrative, Layout B may feel more natural.

How to describe flat-fee work so it feels “real”

One of the biggest mistakes people make with flat-fee billing is writing a vague line item like “Project work” or “Design services.” That line item doesn’t reassure the client; it invites questions. Instead, treat the flat fee as a packaged deliverable and describe it like one.

Better flat-fee descriptions include:

• “Brand identity package: 3 logo concepts, 2 revision rounds, final files (SVG, PNG, PDF)”

• “Discovery workshop (90 minutes) + summary notes + project roadmap”

• “Website build (Phase 1): 5 pages, responsive layout, basic SEO setup”

• “Financial model template (v1): inputs, outputs, scenario toggles, handoff walkthrough”

The goal is to make the client think, “Yes, that’s what we agreed on.” If your agreement is detailed, the invoice description can be shorter, but it should still communicate what the flat fee covers.

How to present hourly work with enough detail (without overwhelming)

Hourly items are where invoices can either build trust or create friction. Too little detail makes the client uneasy. Too much detail can make the invoice hard to read. The best invoices provide a clear summary and offer deeper detail when needed.

Best practice for hourly line items:

• Include a date range (or dates per line item)

• Include a short description tied to outcomes

• Show hours and rate

• Avoid internal jargon

• Group similar tasks when appropriate

Examples of client-friendly hourly descriptions:

• “Client call + follow-up action items (Jan 8): 1.0 hr”

• “Content updates and formatting for Services page (Jan 9–10): 2.5 hrs”

• “Troubleshooting payment integration and testing (Jan 12): 1.75 hrs”

• “Additional revision round (outside included scope) (Jan 14): 2.0 hrs”

If you track time in detail, you can still invoice in grouped blocks. Many clients prefer grouped lines that tell a coherent story of value, rather than a dozen tiny entries. However, if your client requires granular billing, list the entries individually.

Prevent “double charging” concerns with one sentence

The most common objection to mixed invoices is: “Wait, wasn’t this included in the flat fee?” You can prevent that by labeling hourly items as out-of-scope or additional work, when that’s true, and by referencing your agreement.

On the invoice, add a short note like:

“Hourly items reflect requested work outside the flat-fee scope or beyond included revisions, per our agreement.”

This isn’t legal language; it’s clarity language. It reminds the client that hourly billing isn’t arbitrary—it’s tied to a previously agreed model.

Decide whether to bill hourly work as time entries or as task bundles

Hourly billing can be presented in different levels of granularity. The right level depends on the client relationship, the size of the invoice, and the norms in your industry.

Option 1: Time-entry style (most transparent)

List each time entry with date, description, hours, and rate. This is common for professional services and for clients with strict procurement processes.

Option 2: Task bundles (most readable)

Combine related entries into a single line: “Site updates and QA testing (Jan 5–12): 6.0 hrs.” This is common for creative work and small business clients who want the big picture.

Option 3: Hybrid (summary + detail)

Use task bundles on the invoice and include an attached time report. In many cases, an invoicing app can generate this time report automatically. The invoice stays clean, and the details are available if someone asks.

Handling retainers, deposits, and prepaid hours

Many US freelancers and agencies combine flat-fee and hourly billing using retainers or deposits. Here’s how to invoice these correctly and avoid confusion.

Flat-fee deposits

If you charge a deposit for a flat-fee project (for example, 50% upfront), your invoice should show the full flat-fee line item and then show the deposit as either:

• A separate invoice (deposit invoice) followed by a final invoice that shows the remaining balance, or

• A line item credit on the final invoice (“Less deposit received”)

Either method works. What matters is that your client can see: total project fee, what they’ve already paid, and what remains.

Hourly retainers (prepaid time)

If a client prepays for a block of hours (for example, 10 hours per month), treat it like a credit balance. On the invoice, you can show:

• “Monthly retainer: 10 hours” as a flat fee (the purchase of availability/time)

• Hourly usage lines beneath it (“Used: 6.5 hours this period”)

• Remaining balance (“Remaining retainer hours: 3.5”) in the notes

Be consistent about whether unused hours roll over. If they do, track the balance month to month. If they don’t, communicate the policy clearly in your agreement.

Combining a project flat fee with an ongoing support retainer

A common structure is: a one-time flat fee for setup/build plus a monthly flat fee for support, with hourly billed only for special requests. Your invoice can include both flat-fee line items (project milestone and monthly support) and then hourly lines for additions. In the notes, clarify what the support fee includes (e.g., up to X tickets or X hours of minor updates) and what triggers hourly billing.

US sales tax basics for services (and why it matters on mixed invoices)

In the US, sales tax rules vary by state and sometimes by city or local jurisdiction. Whether you need to charge sales tax depends on several factors: where you have tax obligations, where your client is located, and whether the service or digital product you’re selling is taxable in that jurisdiction.

For many service providers, especially in professional services, pure services may be non-taxable in many states. But some states tax certain services, and many states treat digital goods or software-related deliverables differently. A mixed invoice can complicate things if part of your work is taxable and part is not.

Practical approach:

• If you’re required to collect sales tax, configure tax rules by line item.

• Mark taxable items appropriately (for example, taxable digital deliverables) and keep non-taxable services untaxed if permitted.

• If you’re unsure, consult a tax professional for your specific situation and document your approach.

Your invoicing workflow should be able to apply taxes at the line-item level or at least handle different tax categories. Mixed invoices often benefit from line-item tax control because flat-fee deliverables might be taxed differently than hourly consulting.

Should you include expenses on the same invoice?

Often yes, as long as you present them clearly. Expenses might include travel, software licenses purchased specifically for the client, stock assets, printing, shipping, or subcontractor costs if your agreement allows pass-through billing.

Best practices for expenses:

• Create a separate “Expenses” section or group

• Include the date, item, and reason

• Attach receipts if required by the client or your policy

• Clarify whether expenses are billed at cost or with a markup (and ensure your contract permits markup)

If your expense policy is straightforward, combining them on one invoice reduces administrative overhead and speeds up payment.

Writing invoice notes that reduce questions and speed up payment

A short invoice note can do more to prevent delays than another page of line items. Clients pay faster when the invoice answers common questions without requiring an email exchange.

Useful notes for combined invoices include:

• The billing period: “Billing period: Jan 1–Jan 15”

• Scope reminder: “Flat fee covers agreed deliverables; hourly lines reflect additional requests outside scope.”

• Payment terms: “Payment due within 14 days.”

• How to pay: “Pay by card or bank transfer using the link on this invoice.”

• Late fee reminder (if applicable): “Payments past due may incur a late fee per our agreement.”

Keep the tone professional and neutral. The invoice note should feel like a helpful summary, not a confrontation.

Examples of combined hourly + flat-fee invoice line items

Below are examples you can adapt. The exact formatting depends on your invoicing system, but the content principles stay the same.

Example 1: Website project with additional hourly revisions

Flat-fee services

• Website build (Phase 2 milestone): responsive layout, 5 pages, launch checklist — $2,500.00

Hourly services

• Additional revision round (outside included scope) (Jan 10–12) — 3.0 hrs × $120/hr = $360.00

• Copy edits and formatting updates requested after approval (Jan 13) — 1.5 hrs × $120/hr = $180.00

Total due

Subtotal: $3,040.00

Example 2: Flat-fee discovery + hourly implementation

Flat-fee services

• Discovery workshop + roadmap deliverable — $1,200.00

Hourly services

• Implementation support: analytics setup and event testing (Jan 5–9) — 4.25 hrs × $150/hr = $637.50

• Team training call + Q&A (Jan 11) — 1.0 hr × $150/hr = $150.00

Total due

Subtotal: $1,987.50

Example 3: Monthly retainer (flat) plus hourly overage

Flat-fee services

• Monthly support retainer (includes up to 5 support hours) — $900.00

Hourly services

• Overage support hours beyond retainer (Jan 1–31) — 2.0 hrs × $180/hr = $360.00

Notes

• Retainer hours used: 5.0

• Overage hours billed separately: 2.0

Total due

Subtotal: $1,260.00

What to do when the client asks for a change mid-project

Scope changes are normal. The key is to handle them in a way that keeps billing fair and predictable. When a client requests something that may be outside the flat fee, follow a simple process:

1) Identify whether it’s included. Check your scope definition. If it’s included, do it under the flat fee. If it’s not, treat it as additional work.

2) Communicate early. Tell the client the request is outside scope and will be billed hourly (or quoted separately). Do this before you begin work, not after.

3) Provide an estimate. Even a rough estimate is helpful: “This looks like 2–4 hours.” Clients dislike surprises more than they dislike costs.

4) Get a quick approval. A simple written “Yes, proceed” can prevent disputes later.

5) Invoice clearly. On the invoice, label it as an additional request and include dates and a clear description.

This process helps clients feel in control, and it protects you from awkward billing conversations.

Handling caps, not-to-exceed limits, and approvals

Some US clients, especially larger companies, want a cap on hourly charges. You can absolutely accommodate this, and it can make clients more comfortable approving additional work.

How to handle a cap:

• Agree on a not-to-exceed amount (e.g., “Hourly work capped at $1,000 for this phase unless approved”).

• Track hours against the cap.

• Notify the client when you approach the cap (e.g., at 70–80%).

• Pause and request approval to continue if you’ll exceed it.

This policy is client-friendly and reduces payment delays because the client never feels ambushed by an unexpected invoice total.

Discounts: apply them thoughtfully on mixed invoices

Discounts can be helpful for closing a deal or rewarding a long-term client. But in mixed invoices, discounts should be applied in a way that stays logical.

Common discount strategies:

• Discount the flat-fee portion (e.g., “10% off project fee”)

• Discount specific hourly categories (e.g., “Training call discounted rate”)

• Apply a one-time courtesy discount as a separate line item (clearly labeled)

Avoid applying a discount without explanation. If the client sees “Discount” with no context, they may wonder what it applies to and whether it’s correct. Clear labeling prevents back-and-forth.

Rounding, minimum billing increments, and travel time

In the US, many service providers bill in increments (such as 0.1 hour, 0.25 hour, or 0.5 hour). There’s nothing inherently wrong with this, but it should be disclosed in your agreement and applied consistently.

Tips:

• Choose an increment that matches your work. Consultants often use 0.25 hour; developers often use 0.1 hour; attorneys often use 0.1 hour.

• If you bill minimums (e.g., “1-hour minimum for on-site visits”), put it in writing.

• Decide whether travel time is billed and at what rate (full rate, reduced rate, or pass-through expenses). Document it.

On invoices, the cleanest approach is to show actual billed hours (already rounded per your policy) rather than explaining the rounding math line by line.

Payment methods and how they affect your invoice wording

In the US, clients commonly pay invoices via bank transfer (ACH), credit card, check, or digital payment options. Your invoice should make payment easy and reduce friction.

Invoice wording tips:

• Include a clear “Balance due” and “Due date.”

• Put payment instructions in a consistent place (often near the bottom).

• If you accept cards, mention processing time if it matters (some clients pay faster with cards).

• If you accept checks, include the payable-to name and mailing address (if applicable).

A combined invoice can be a larger total than a simple hourly invoice, so convenience matters. The easier it is to pay, the fewer delays you’ll face.

How to invoice when the flat fee is paid in milestones

Milestone billing is one of the cleanest ways to combine flat-fee and hourly work. Each invoice can include a milestone portion of the flat fee plus the hourly items for that phase.

Example milestone plan:

• Milestone 1: 40% upfront (flat fee)

• Milestone 2: 30% after first deliverable approval

• Milestone 3: 30% at launch/completion

Hourly items can appear on any milestone invoice, but you’ll avoid confusion if you align hourly items with the timeline: hourly lines should reflect work performed during the same period as the milestone. Include a billing period note so the client can connect the dots.

Refunds, write-offs, and goodwill adjustments

Sometimes you’ll adjust a bill to preserve a relationship or correct a misunderstanding. When you do, keep it transparent on the invoice.

Common approaches:

• Add a negative line item labeled “Goodwill adjustment” or “Courtesy credit”

• Reduce or remove a specific hourly line item and note the reason

• Apply a discount to the flat-fee portion if a deliverable changed

Avoid silent adjustments that make the invoice not match the agreement without explanation. A simple label keeps everything consistent and professional.

Disputes and how to avoid them with better documentation

Invoice disputes usually come from one of three sources: unclear scope, surprise hourly charges, or missing detail. You can reduce disputes dramatically by tightening a few habits:

1) Confirm scope changes in writing. Even a short email or message is enough.

2) Send invoices on a consistent cadence. Monthly billing helps clients budget and reduces sticker shock.

3) Use clear line-item descriptions. Tie work to outcomes and client requests.

4) Include a billing period. This eliminates “When did this happen?” confusion.

5) Keep timesheets organized. If you ever need to justify a charge, you can do it quickly.

Clients don’t love disputes any more than you do. Most clients simply want to understand what they’re paying for. Clarity is the fastest route to payment.

What your combined invoice should always include in the US

Regardless of your industry, a professional US invoice should include certain core elements. These aren’t just nice-to-haves; they make it easier for clients to process payment and for both sides to keep accurate records.

Core invoice fields:

• Your business name and contact info

• Client name and billing address (or at least client name)

• Invoice number (unique and sequential is best)

• Invoice date

• Due date and payment terms

• Line items with descriptions, quantities/hours, and rates

• Subtotal

• Taxes (if applicable)

• Payments/credits applied (if applicable)

• Total due / balance due

• Payment instructions

These basics matter even more for combined invoices because the client may send the invoice through internal approval steps. The easier it is for them to match the invoice to the agreement and approve it, the faster you get paid.

How to set this up smoothly in invoice24

To invoice for combined hourly and flat-fee work efficiently, you want a workflow that minimizes manual formatting and reduces mistakes. A good approach is:

1) Create the flat-fee items as saved products/services. For example: “Discovery Workshop,” “Phase 1 Website Build,” or “Brand Identity Package.” This makes invoices consistent and professional.

2) Track your time for hourly work. Record time entries with dates and descriptions tied to client requests or outcomes.

3) Add time entries to the invoice as hourly lines. You can list them individually or group them by category, depending on client preference.

4) Apply taxes per line item if needed. This is especially helpful when some deliverables or digital products are taxable while certain services are not.

5) Add invoice notes with billing period and scope reminder. This prevents the most common questions.

6) Send and accept payments quickly. Include multiple payment methods and a clear due date. If partial payments are allowed, the remaining balance should be visible.

The main goal is consistency: use the same structure each time so clients recognize your format and can approve payment faster.

A simple checklist before you send a combined invoice

Before you hit send, run through this quick checklist. It catches the issues that most often cause delays:

• Flat-fee line items match the agreed scope and milestone

• Hourly items have clear descriptions and dates or a billing period

• Hourly items are labeled as additional/out-of-scope when appropriate

• Hours and rate are correct (including rounding/increments)

• Expenses are separated and documented if required

• Taxes are applied correctly (if you collect them)

• Deposit or retainer credits are shown clearly

• Due date and payment terms are visible

• Payment instructions are included and up to date

• The total due makes sense at a glance

Putting it all together: clarity, consistency, and confidence

Invoicing clients for combined hourly and flat-fee work in the US is not only acceptable—it’s often the most practical way to bill for real-world projects. The key is to separate what’s fixed from what’s variable, describe each piece clearly, and tie hourly charges to client-driven additions or work outside the original scope.

A great combined invoice makes the client feel informed rather than defensive. It reinforces what was agreed upon, shows what was done, and makes payment straightforward. When you use a consistent structure—flat-fee section, hourly section, optional expenses, and clean totals—you reduce questions, shorten approval cycles, and get paid faster.

If you build your workflow around a solid agreement, good time tracking, and clear line-item descriptions, mixed billing becomes simple. Your clients get predictable pricing plus flexibility, and you get fair compensation for both defined deliverables and evolving requests. That’s the goal of combined invoicing: a billing method that fits how work actually happens.