By Jeff Burt, founder of Invoice Goat. Updated October 7, 2026.
How to Read Your Invoice Totals
The box next to the form updates as you type. Here's what each line means on the PDF your customer gets.
- Subtotal is every line added up: quantity times price, for labor and materials.
- Sales tax is your rate applied to the lines with the Tax box checked. When some lines aren't taxed, the box shows which amount the rate was applied to, and the PDF marks the taxed lines.
- Total is the subtotal plus tax: the full price of the job.
- Deposit paid is the money your customer already gave you, taken off the total.
- Balance due is what they owe you now. It's the biggest number on the invoice, with the due date written out next to it.
What to Put on a Contractor Invoice
- Your business name, phone and email, so the customer knows who to pay and how to reach you.
- The customer's name and the job address.
- An invoice number and the date you sent it.
- Labor and materials on separate lines, plus any change orders the customer approved.
- Sales tax, the total, the deposit and the balance due.
- A due date written as a date, and how to pay you: check, card, bank transfer or Zelle.
For the whole process, from the signed quote to following up on a late payment, read how to invoice as a contractor.
Taxing Materials and Labor Separately
Sales tax on contractor work depends on the state. In Texas, labor to repair or remodel a home isn't taxable. On a contract that lists materials and labor separately, the contractor collects sales tax on the materials (Texas Comptroller, publication 94-116). In Washington, sales tax on construction covers the labor too (Washington Department of Revenue).
That's why every line has its own Tax box. Uncheck it on any line your state doesn't tax. Check with your state's revenue department if you're not sure. This page isn't tax advice.
How the Math Works
Each line total is quantity times price, rounded to the cent. Quantities can have decimals, so 2.5 hours of labor works. The subtotal adds up every line. Sales tax is your rate times the lines with the Tax box checked, rounded to the cent. The total is the subtotal plus tax, and the balance due is the total minus the deposit already paid.
Two limits to know. You get one tax rate per invoice. And the deposit can't be more than the total, so the form asks you to fix it if it is. The tool runs in your browser and builds the PDF there; we don't save your invoice.
A Worked Example
The example in the form is a water heater replacement for a homeowner in a state that taxes materials but not repair labor. The heater ($1,150), the fittings ($185) and a shutoff valve added by change order ($45) are taxed: $1,380. The labor ($500 for 4 hours at $125), the haul-away ($60) and the valve labor ($100) aren't.
The subtotal is $2,040. At an example rate of 8.25%, the tax on $1,380 is $113.85, so the total is $2,153.85. The customer paid a $600 deposit when they signed the quote, so the balance due is $1,553.85. Check a labor line's Tax box in the form above and watch the tax change.
Get Paid Faster
A PDF works, but your customer still has to write a check or call you with a card. With Invoice Goat, you send the invoice as a link and your customer pays it by card from their phone. As of September 2026, 31% of invoices sent through Invoice Goat are paid in under 24 hours. One price covers every feature; see Invoice Goat pricing.
Starting a job instead of finishing one? Use the free quote and estimate maker to price it and get it signed first.
Questions
Is this contractor invoice template free?
Yes. Fill it in and download as many invoices as you like. The PDF is made in your browser and we don't keep a copy.
What should a contractor's invoice include?
Your business name and contact details, the customer's name and job address, an invoice number and date, labor and materials on separate lines, sales tax, the total, any deposit already paid, the balance due, a due date written as a date, and how to pay.
Can I download it as a Word file?
No, it makes a PDF, which looks the same on every phone and computer and can't be edited by accident. To change something, edit the form and download it again.
Does it work on my phone?
Yes. The form works in any phone browser, so you can write the invoice in the driveway and send the PDF by text or email before you leave.
To link to this tool: Free Contractor Invoice Template and Invoice Maker, Invoice Goat, https://invoicegoat.com/tools/contractor-invoice-template