Invoice customers for project expenses

Learn how to create invoices from project expenses in QuickBooks Online Plus and QuickBooks Online Advanced.

Once you set up Projects, you can invoice customers for specific project-related expenses (including timesheets). You can use these steps whether you’re charging customers for time and materials, or a fixed fee.

Step 1: Decide how you’ll charge for projects

If you charge for time and materials, you usually invoice customers for specific project expenses and hours worked. You’ll need to make your project expenses and timesheets billable so you can add them to invoices.

If you charge a fixed fee, you typically don't invoice for specific project expenses. Instead, you send customers an estimate for the entire project. You can convert the estimate into an invoice when the work begins.

However, there may be times when you need to charge for specific project expenses. A common example is when customers ask for extra work outside the original project plan.

Step 2: Turn on billable expenses

If you haven’t already, turn on billable expenses.

1. Go to Settings and select Account and settings.
2. Select the Expenses tab.
3. From the Expenses section, select Edit.
4. From the Bills and expenses section, turn on Make expenses and items billable.
   Note: If this is your first time turning on the switch, select Okay.
5. Select Save, then select Done to close your settings.

You can now make any expense or timesheet in QuickBooks billable.

Note: Users can also set up a markup rate and make other necessary settings.

Step 3: Make project expenses billable

1. Go to All apps , select Projects, then select Projects (Take me there).
2. Then, select your project.

Tip: You can customise your menu by selecting ⚙ Menu settings, then select the tabs that you want to be readily available.

Project expenses

1. Select Add to project ▼ dropdown, then select Expense.
2. Add expenses to the form.
3. Select the Billable box next to each item.
4. Select the project from the Customer/Project dropdown (this is different from the payee for the expense).
5. Select Save and close.

Create a billable time activity

1. Select + New or + Create.
2. Select Single time activity.
3. From the Name ▼ dropdown, select the employee or supplier to be billed.
4. From the Customers ▼ dropdown, select the customer to be billed.
5. From the Service ▼ dropdown, select the service.
6. Select the Billable (per hour) checkbox and enter the billable rate.
7. Optionally, select the Taxable checkbox if required.
8. Select start and end time from the Start time and End time ▼ dropdowns.
   Note: Make sure the Set start and end time switch is turned on.
9. Select Save and close.

Project timesheets

1. Select + New or + Create.
2. Select Weekly timesheet.
3. Select an employee.
4. Adjust the date range if necessary.
5. Add the number of hours worked for that day or the week.
6. In the Details section, select a customer or a project to add the project.
7. Select Billable (/hr) to make the timesheet billable.
8. Add other details as necessary, then select Save and close.

Now that you’ve made all of your project expenses and timesheets billable, go back to the project's Overview tab.

Step 4: Invoice your customer for billable expenses

1. Go to All apps , select Projects, then select Projects (Take me there).
2. Then, select your project.
3. Select Add to project ▼ dropdown, then select Invoice.
4. Select the customer you want to invoice from the Customer ▼ dropdown.
   Note: If you're on the new invoice layout, you may see only the ▼ dropdown. The Customer field name isn't displayed.
5. Your billable expenses and timesheets will appear in the Add to Invoice pane. Add all the billable expenses or time you want to add to the invoice.
   Note: If you're on the new invoice layout, you may see the Suggested transactions pane instead.
6. Complete the invoice and send it to your customer.

If you want to send individual expenses or timesheets as an invoice:

1. Go to your project.
2. Go to the Transactions tab.
3. Find the billable expense or timesheet on the list.
4. Select Create invoice from the Action column.
5. Complete the invoice and send it to your customer.

If you've created billable time, billable expenses, delayed charges, delayed credits, or estimates, you'll see them under Suggested transactions or Add to Invoice (If you're on the old invoice layout). To add them to your invoice:

1. Go to All apps , select Sales & Get Paid, then select Invoices (Take me there).
2. Find the invoice for the customer whose timesheets and billable expenses have been created.
3. Select View/Edit from the Action column.
4. If you're on the new invoice layout:
   1. Go to Manage and select Suggestions ▼ dropdown.
   2. Select the Suggested transactions link.
   3. Select the Filter and filter by Transaction type and Date.
5. If you're on the old invoice layout:
   1. Select the small arrow icon.
   2. Select the Filter and filter by All types and All dates.
6. Find the Billable time, Billable expense, or the transaction you want to add, then select Add.
7. Fill out the rest of the invoice as needed.
8. When you're done, select Save and close.

When you follow these steps, QuickBooks automatically connects the billable expense and invoice to your project.