How to set up Time and Materials billing items
Time and Materials Billing allows you to bill your projects based on how many hours your team has worked on a line item. The idea behind T&M Billing is that the customer is billed based on how much work was actually put into the task, not how much work was expected. If your team puts in less work on the task than was expected, your customer doesn’t need to pay the full predicted cost. On the other hand, if your team ends up working more hours on the task than was expected, you are able to bill your customers for that time and effort.
To start, make sure you have a service billing group set up to use T&M billing. You can assign this group to any service item on the order entry screen. The customer will see on the contract what items are set up for T&M billing.
Warning
Service Products that use T&M Billing cannot use partial invoicing. When adding or editing a Service Product, in the pop-up, be sure the Partial Invoicing field is set to ‘No Partial Invoicing’.
Tip
You also need to make sure that you have a Service Product that can be on an order, and has your T&M Service Billing Group set as its default. You can add or edit Service Products by navigating to Settings > Products > Service Products.
Create a project and assign the order to the project or create a milestone on a current project and assign the service ticket. Once the milestone is created, you can start creating tasks and assigning those tasks to users so they can enter their hours. You can also manually create a milestone on a project and assign any of the customers other service tickets; this is helpful if there is a change order that will require additional billable work.
When it comes time to need to bill a customer for hours spent on the project, go to the project billing report under Reports > Other > Project Billing or to the Billing Tab on the Project.
On the Report, Select the project(s) and the date range of the hours you want to bill. You must specify a date range in order to bill hours. For example, you can bill for the last month, week, day, but you can't bill for all time. On the Billing Tab, click on the invoice action next to the line item and enter the period. Either way, the system will create a new billable items for your team to invoice.
When you create a billable item, the system will create a new line item on the customer order for the service with the number of hours you are planning to the bill. When a Billable Item is created, the system will create an external invoice for any amount of the original item that is unbilled, and will adjust the total amount, and quantity left on the line item accordingly. The system will also create a Recurred line item automatically for the amount of the line item that was billed. This recurred line item is what can be invoiced for your customers. All of this information can be viewed on the Company’s Order tab.
You can create the invoice by going to Billing > Invoices > Create Invoices or hover over the quick add and click add invoice. Enter the customer or order number and search to find the billable items.
You can choose to include other line items on the invoice as well. For example, you may be billing the customer for their monthly fee plus any hours you added to the project on a single master invoice.