Invoicing and managing customer deposits
Introduction
You're launching a major project for a client and wondering whether to request a deposit? You're right to think about it. For long assignments or high amounts, waiting until the end of the project to receive payment exposes your cash flow to unnecessary risks. A client who disappears, disputes the final invoice or delays payment can put your business in difficulty.
Requesting a deposit or organising partial payments protects your business. But this practice raises practical questions: how do you create a deposit invoice that complies with Swiss standards? Should you charge VAT on the deposit? How do you track partial payments and calculate the final balance? What mandatory information must appear on the balance invoice?
This guide explains step by step how to invoice deposits, manage VAT correctly, organise payment tracking and avoid common mistakes. You'll also discover how invoicing software simplifies deposit management and automates calculations.
📌 Summary (TL;DR)
Deposits secure your cash flow on large projects. To invoice them correctly, include mandatory information, calculate VAT on each partial payment and use compliant QR invoices. Track each deposit in a table, follow up on unpaid amounts and accurately deduct received amounts on the final balance invoice. Invoicing software automates these calculations and centralises tracking to avoid errors.
📚 Table of contents
What is a deposit and why request one?
A deposit is a partial payment made before the complete delivery of a product or the completion of a service. Unlike the final balance, it secures part of the amount from the start of the project.
Requesting a deposit offers several concrete advantages: you secure your cash flow, limit the risk of non-payment and finance initial costs (materials, subcontracting). It's particularly useful for large projects, long services or bespoke orders.
Example: On a project worth 10,000 CHF, a 30% deposit (3,000 CHF) allows you to cover the initial costs without waiting for the end of the work.
Types of deposit invoicing
There are several methods for invoicing partial payments. The choice depends on the nature of your project, its duration and your agreements with the client.
Each method has its specificities in terms of VAT calculation, mandatory information and traceability. Here are the three main approaches used in Switzerland.
Standard deposit invoice
The deposit invoice is a proper invoice with VAT calculated on the partial amount. It must include all mandatory legal information and a payment QR code.
Example: Deposit of 3,000 CHF excl. VAT + VAT 8.1% (243.90 CHF) = 3,243.90 CHF incl. VAT to pay.
Clearly state "Deposit" or "Partial payment" and the reference to the initial project or quote to facilitate tracking.
Proforma invoice
The proforma invoice is a document with no accounting value that requests payment before issuing the final invoice. It doesn't count towards your turnover until payment is confirmed.
Use it to secure an order or verify the solvency of a new client. Once payment is received, issue the actual deposit invoice.
To learn more, consult our guide on managing deposits and proforma invoices.
Milestone invoicing (payment milestones)
This method divides your project into phases with progressive invoicing. Each validated stage triggers a partial invoice.
Example: Project worth 20,000 CHF divided into 4 milestones of 5,000 CHF (design, development, testing, delivery).
Ideal for long services: it improves your cash flow and reassures the client about progress. Discover how to optimise this approach in our article on project tracking and invoicing.
How to create a compliant deposit invoice
To issue a deposit invoice that complies with Swiss standards, follow these simple steps and ensure you include all mandatory information.
A deposit invoice must be as rigorous as a standard invoice: continuous numbering, correct VAT calculation and QR invoice to facilitate payment.
Mandatory information on the deposit invoice
Your deposit invoice must include:
- The mention "Deposit" or "Partial payment"
- A unique invoice number in your series
- The issue date
- Your complete details and those of the client
- The amount excl. VAT, VAT and total incl. VAT
- A compliant QR invoice
- The reference to the initial project or quote
This traceability is essential to link the deposit to the final balance invoice.
Calculating VAT on deposits
VAT is calculated on each deposit at the time of receipt, according to the method you have chosen (agreed or effective services).
Example: Deposit of 3,000 CHF excl. VAT with VAT 8.1% = 243.90 CHF VAT, i.e. 3,243.90 CHF incl. VAT to invoice.
This VAT must be declared in your VAT return for the relevant period. To understand which method to choose, read our guide on VAT declaration based on invoice or payment.
QR invoice for deposits
Even for a deposit, you must include a QR invoice compliant with Swiss standards. The QR code facilitates payment and ensures automatic traceability.
Use a unique structured reference for each deposit to facilitate bank reconciliation. BePaid automatically generates compliant QR invoices for all your deposits.
Managing deposit and partial payment tracking
Once your deposit invoices are issued, you must accurately track the amounts received and remaining balances for each project.
Without clear organisation, you risk losing track between different projects, forgetting reminders or miscalculating the final balance.
Deposit tracking table
Create a tracking table with these columns: project name, total amount excl. VAT, invoiced deposits, amounts actually received, payment dates and remaining balance due.
Example: Project A (15,000 CHF) – Deposit 1 (4,500 CHF) received on 15/01 – Deposit 2 (4,500 CHF) pending – Balance 6,000 CHF.
Automatic bank reconciliation allows you to update this tracking in real time without manual entry.
Reminders and follow-ups for unpaid deposits
An unpaid deposit often blocks the start of the project. Follow up quickly with a firm but professional tone: 3-5 days after the due date for a first reminder.
Specify the consequences of delay (project suspension, late payment interest). BePaid automates reminders to save you time and maintain regular pressure.
Client tracking and payment history
Centralise the complete history of deposits per client: invoiced amounts, payment dates, relevant projects. This overview helps you identify good payers and at-risk clients.
Rigorous client tracking also facilitates your cash flow forecasts and commercial decisions (payment terms, requesting higher deposits).
Invoicing the final balance after deposits
Once the project is completed, you must issue the balance invoice by properly deducting all deposits already received.
This final step requires great transparency to avoid any confusion or dispute from the client.
Calculating the remaining balance due
The formula is simple: Total amount incl. VAT – Total deposits incl. VAT = Remaining balance due.
Complete example: Project worth 15,000 CHF excl. VAT + VAT 8.1% (1,215 CHF) = 16,215 CHF incl. VAT. Two deposits of 3,243.90 CHF incl. VAT each = 6,487.80 CHF already paid. Final balance: 16,215 – 6,487.80 = 9,727.20 CHF incl. VAT.
Always check your calculations to avoid errors that damage your credibility.
Information on the balance invoice
Clearly state "Balance invoice" or "Final balance" at the top of the document. List the previous deposit invoices with their numbers, dates and amounts incl. VAT.
Recommended presentation:
- Total project amount: 16,215 CHF incl. VAT
- Deposit 1 (invoice no. 2024-045 dated 10/01): -3,243.90 CHF
- Deposit 2 (invoice no. 2024-067 dated 15/02): -3,243.90 CHF
- Balance to pay: 9,727.20 CHF
This breakdown reassures the client and facilitates their verification.
Common mistakes to avoid with deposits
Certain errors frequently recur in deposit management. They create accounting complications, tensions with clients or cash flow problems.
Here are the most common pitfalls and how to avoid them.
Forgetting VAT on deposits
Invoicing a deposit excl. VAT without VAT is a classic mistake. You will then have to absorb the VAT on the final invoice, which reduces your margin.
Always calculate VAT from the first deposit according to the applicable rate (8.1%, 3.8% or 2.6%).
Not deducting deposits correctly
Confusing amounts excl. VAT and incl. VAT when deducting deposits creates discrepancies incomprehensible to the client. Some even forget to deduct a deposit, which amounts to double invoicing.
Systematically list all deposits incl. VAT on your balance invoice with their precise references.
Lack of traceability
Without consistent numbering and clear references between deposit and balance invoices, it's impossible to reconstruct a project's history.
Adopt a logical numbering system: F2024-001-A1 for the first deposit, F2024-001-A2 for the second, F2024-001-BALANCE for the final invoice. This structure facilitates tracking and verification.
Managing deposits with invoicing software
Dedicated invoicing software automates calculations, secures compliance and centralises tracking of all your partial payments.
You save time, reduce errors and maintain a clear overview of your cash flow.
Automation of calculation and VAT
The software automatically calculates VAT on each deposit according to the configured rate. It generates compliant QR invoices and ensures consistency between deposits and balance.
No need to manually check your calculations: the system guarantees reliability. BePaid integrates complete Swiss VAT management for all your deposits.
Centralised tracking of partial payments
View all your deposits in real time: invoiced, received, pending. Automatic bank reconciliation updates the status of each payment without manual entry.
Dashboards give you a clear view of your forecast cash flow and remaining balances per project.
BePaid offers this complete solution from 20 CHF/month, with a free version to test (10 invoices and 5 clients). You manage your deposits in a few clicks, without technical complexity.
Deposit management represents an essential lever for securing your cash flow and limiting risks on your projects. By creating compliant deposit invoices with mandatory information, correctly calculating VAT and ensuring rigorous tracking of partial payments, you avoid costly errors and tensions with your clients.
QR invoices greatly facilitate the process by allowing your clients to quickly settle their deposits, whilst a centralised tracking system helps you maintain control over all your ongoing payments. Don't forget to accurately deduct received deposits when invoicing the final balance to maintain clear and transparent accounting.
With BePaid, create your compliant deposit invoices in a few clicks, automate VAT calculation and track all your partial payments from a single interface. Test our solution free of charge and simplify your deposit management today.
