Deposit Invoice Template - Australia

A deposit invoice should clearly show your business name and ABN, the client's details, invoice number, invoice date, and GST identification. The description must specify it's a deposit (e.g., '50% deposit for kitchen renovation'), itemized line items, the deposit amount, GST calculated on that amount, total due, payment due date, and bank details. Crucially, include clear terms stating refund conditions—whether the deposit is non-refundable, partially refundable if the project is cancelled, or fully refundable if you can't complete the work. This transparency protects both you and your client from misunderstandings.

GST is charged on the full deposit amount at the standard rate of 10%. If you're invoicing a $10,000 deposit, you calculate GST on that $10,000, adding $1,000 GST to make the total payable $11,000. This GST is immediately reportable to the ATO in your Business Activity Statement (BAS) and is yours to remit as an GST-registered business, regardless of when the final project is completed. The key point: you don't recalculate GST when issuing the final invoice—the deposit GST has already been accounted for.

Deposit percentages vary widely by industry. Construction and trades typically request 30–50% upfront to cover material costs and labour allocation. Service-based businesses often ask 25–30%, while creative professionals may request 50% to secure the booking. Smaller retail transactions rarely need deposits, but larger custom orders might justify 20–30%. Check your industry standards and similar businesses in your region. Always communicate your deposit policy upfront in quotes and contracts—this sets clear expectations and reduces disputes with clients.

On your final invoice, show the total project cost first, then deduct the deposit amount paid—often listed as 'Less: Deposit Received [Invoice #].' This allows the client to see the full project cost and the credit applied. Calculate GST on the remaining balance due. Since GST was already charged on the deposit, you don't charge it again on that portion. This method makes the relationship between deposit and final invoice clear to the client and your accounting records, simplifying reconciliation and cash flow tracking.

The most common methods are bank transfer (EFT), which is fast and traceable, and BPAY, preferred by many Australian businesses for its convenience and record-keeping. Credit card payments involve higher fees and processing delays. If accepting cash, ensure you comply with AML/CTF reporting requirements if the amount exceeds $10,000. Always provide clear payment instructions on the invoice—your business bank account details, invoice number, and client name as reference. Document all payments promptly to avoid reconciliation confusion when issuing the final invoice.

Your deposit invoice must clearly specify whether the deposit is non-refundable, partially refundable, or refundable under certain conditions. Common scenarios include: non-refundable if the client cancels after you've begun work or committed to materials, refundable if you can't provide the service, or refundable minus a reasonable cancellation fee (often 10–20% to cover costs). Being explicit protects both parties—clients know the risks upfront, and you're covered if they change their mind. Different industries have different norms, so align your terms with market expectations.

Yes, and it's often best practice for larger projects. You can issue a deposit invoice when work begins, another when materials are procured, and potentially a third for labour allocation. Each invoice gets its own unique number and date, but link them together with a project reference number for easy tracking. GST applies to each deposit invoice separately. This approach gives better cash flow visibility, tracks project progress more accurately, and makes client communication clearer—they see exactly what stage their deposit covers.

A deposit invoice is issued before goods or services are delivered, securing funds and commitment from the client. A standard tax invoice is issued after delivery or upon payment and records a completed transaction. Both must include ABN, GST details, and business information, but a deposit invoice emphasises refund and cancellation terms prominently, while a tax invoice emphasises delivery details. A deposit invoice should explicitly state what work or materials the deposit covers and timeline expectations. When the project concludes, the deposit is credited on your final invoice.