# Down payments
Represent down payments correctly and offset them against the work you actually deliver — using a negative expense.

:::lock{title="Required rights"}
Project edit
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## Overview

In projects with a down payment (an advance the client pays up front), the question is how to account for the advance correctly — especially against the project budget and the work delivered. The approach: record the down payment as a **negative expense**, then add it as a line item on the first regular invoice so it's offset against the delivered work.

## Two levels of budget control

For time-based work there are two budgets, and a down payment only affects one of them:

1. **Project budget** — covers all planned and delivered work (every time entry and its value). This is how you steer profitability.
2. **Billing budget** — how much can still be invoiced. It also accounts for amounts already invoiced, including down payments.

## Offset a down payment

The example below uses a **€10,000** down payment.

### 1. Record the down payment as a negative expense

On the project's Invoicing tab, add an [expense](/guides/invoice-expenses) with a **negative billable amount**:

| Field                  | Value                      |
| ---------------------- | -------------------------- |
| **Billable amount**    | −€10,000                   |
| **Note**               | e.g. "Down payment credit" |
| **Billable**           | Yes                        |
| **Included in budget** | Yes                        |
| **Internal cost**      | €0                         |
| **Recurring**          | Off (billed once)          |

![](/images/guides/down-payments/image-mqs81kq6.png)

:::tip
A €0 internal cost means the credit reduces the billable amount without distorting your profitability calculation.
:::

### 2. Log time entries as usual

Log time entries on the project as normal — in the background they add up to the monetary value of the work delivered (e.g. €50,000 by a given point).

### 3. Add the credit to the first invoice

Once the delivered work exceeds the down payment, issue the first regular invoice:

1. [Create an invoice](/guides/invoice-projects) for the period.
2. Select all **uninvoiced time entries**.
3. Also select the **"Down payment credit"** expense — it's added as a line item.
4. Save and send the invoice.

![](/images/guides/down-payments/image-mqqo55fo.png)

## Result

The invoice total is the delivered work minus the down payment — e.g. €50,000 − €10,000 \= **€40,000**. The time entries are marked invoiced and linked to the invoice, and the billing budget reflects the correct remaining amount, with the full project budget still accounted for.

## Related

* [Invoice projects](/guides/invoice-projects) — create, edit, and send invoices.
* [Invoice expenses](/guides/invoice-expenses) — add and bill expenses.