How to create and draw from a retainer 🎦
If any of your clients pay in advance for your work, you can use a retainer to collect funds up front. After you’ve completed the work, you can create an invoice for tracked time, expenses, or fixed fees to draw from the retainer, and the available funds will be applied to the invoice amount.
Video: How to create and draw from a retainer
This video goes over the basics of creating and drawing from a retainer:
How to create and add funds to a retainer
- Go to Invoices > Retainers.
- Only Administrators have permission to create and edit retainers.
- Click New retainer and pick the client and project you want the retainer to apply to.
- Note: It’s important to choose the correct project in this step, because you can’t change this setting later. Select Apply to all projects if you’d like to include all of the client’s projects. If the client already has one or more project-specific retainers set up, the option to create a new retainer that applies to all of their projects will not be available; the existing retainer(s) would first need to be closed.
- Click the Create retainer button.
- You’ll be taken to the new retainer. There, click the + Add funds button.
- Complete the retainer invoice as you would a free-form invoice.
- Save the retainer invoice and send it to the client.
- Record payment for the retainer invoice when it’s received, and you’ll then be able to draw from the retainer.
- If you’d like to add more funds to the retainer later, follow steps 4 to 7.
How to draw from a retainer
You can draw from a retainer for an invoice based on tracked time and expenses or an invoice for a fixed fee project. Free-form invoices don’t draw from retainers.
- Go to Invoices > Overview and click New invoice.
- Select the client and choose to create an invoice for tracked time, expenses, or fixed fees, then click Choose projects.
- At the bottom of the New invoice page, you’ll be asked if you want this invoice to draw from the relevant retainer. Select this option.
- Continue to complete the invoice.
- Once the invoice is created, the retainer balance will automatically be applied.
- If the retainer covers the invoice amount, it will automatically be marked as paid.
- If the retainer doesn’t cover the entire invoice amount, send the invoice to your client so they can pay the balance.
- If the retainer did not cover the invoice amount, but you have added money to your retainer since you created the invoice, you can edit the invoice and save it again without making any changes. That will prompt the system to re-try drawing down the retainer, and the new funds will apply to your invoice.
A few things to note about retainers:
- You cannot partially pay an invoice with a retainer if there are enough funds to cover the invoice's full amount.
- You cannot apply retainer funds to invoices that were created before the retainer, or which were not set to draw from the retainer when they were created.
- You cannot apply retainer funds to invoices generated from a recurring invoice template.