This template is used for subcontractors who need individualized invoices for the company they are contracting with.
Download our free subcontractor invoice template
Expenses between contractor and subcontractor can become confusing and can easily get lost if not recorded correctly. When working under a company that is not your own, it is important to make use of an invoice template. Distributing your own invoice is advisable so purchases and payments between two to three parties do not get mixed up.
Quickly download our free subcontractor invoice template, which includes:
Products, materials, and labor:
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- Description
- Quantity
- Price per unit
- Hours
- Price per hour
- Total amount
Our subcontractor invoice template breaks down labor, materials used, and pricing in detail.
Click here to download the word document version of a subcontractor invoice template.
What is a subcontractor?
When a business or contractor needs additional assistance with a project or service, they will hire another person or business to help complete these projects and services. Subcontractors are individualized businesses that are hired by contractors to provide labor to their business. Subcontractors typically take on larger tasks and projects. In most cases, they are not considered to be an employee by the contractor who hired them and works for the contractor until the job or project has been completed.
Who hires subcontractors?
Almost any company can hire subcontractors, but there are specific companies that hire subcontractors for every project. For example, construction companies normally work with subcontractors throughout their entire careers. Project developers and managers will form a detailed construction plan, and hire subcontractors who they think would get the job done correctly and accurately. Businesses that fall under the categories of marketing, technology, and administration often hire subcontractors as well.
How does subcontracting work?
If a company has decided they need a job or project done, but finds they need additional help in doing so, they will hire a third-party, or subcontractor. Typically, the process is simple where the contractor gives the subcontractor a job or project with a start date and end date. The subcontractor works to complete this job and is paid by the contractor. Subcontracting can seem like a difficult job. However, if done correctly, it can benefit one’s company and increase clientele. Contractors need to be able to rely on subcontractors to get the job done, and subcontractors should feel confident in the company they are working for. Here is how subcontracting works.
Seeking subcontractors
Looking for subcontractors to help with a project you are tackling is similar to looking for employees for your company. The search for good subcontractors should be taken seriously because ultimately the end result of a project will reflect the contractor and their business. Similarly, if the subcontractor receives positive feedback from clients, they will continue to receive jobs and projects.
To find subcontractors, companies should post and advertise the position until they find candidates that best fit what they are looking for. Once candidates have been reviewed, interviews should be conducted to ensure the subcontractors are capable of the job. This allows companies to get to know subcontractors, their experience, and their qualifications. From there, companies may decide if they feel confident in the candidates they have interviewed.
Protecting your business
In order to protect your business and yourself, contractors and subcontractors should agree on specific terms and conditions. Preparing a well-written agreement that consists of liability terms, labor expectations, and project details is a very effective way to secure contractors’ businesses and the job that is being done. Subcontractors should carefully review the agreement and should also make sure they approve. This will protect both contractors and subcontractors if a disagreement or issue occurs.
Independent subcontractor
Contractors hire subcontractors hoping they will complete the job without micromanaging. Once an agreement is established, the project has been assigned, and the details have been given, subcontractors work on their own. They will ask questions or check in with the employer when needed. Sometimes the contractor will work alongside the subcontractors, but for the most part, they allow the subcontractors to work on their own.
Considering time and benefits
Contractors and subcontractors need to consider the amount of time the job will take, and if it benefits the contractors’ company, or the subcontractors who are working the job. Contractors need to ask themselves if the time and money they put into hiring a subcontractor will benefit their company. The same goes for subcontractors. Is the time, and work subcontractors are dedicating to the job worth the money?
After reviewing what a subcontractor does, you can see why money management can get confusing. Subcontractors are dealing with expenses for both their contractor and their clients. Our subcontractor invoice template is free and is a great way to keep track of expenses while working.
FAQ
How are subcontractors paid?
Subcontractors are typically paid once the job they agreed to has been completed. This is something that is discussed before the job has been assigned. The contractor makes an agreement with the subcontractor after discussing what the job entails. They come to an agreement regarding pay and how payments will be distributed.
Can the template be used for both contractors and subcontractors?
While the template has been designed for subcontractors, contractors may also use the template because they usually record expenses in the same style. However, since subcontractors aren’t micromanaged, they are the individuals who record how much materials were used, and how much the cost of the materials was. Contractors are then provided with the invoice where they decide how costs will be covered.
Do subcontractors speak directly to clients/customers? Is the invoice provided to customers and clients?
Subcontractors don’t normally communicate or discuss the job with clients. This is why it is important for contractors to hire excellent subcontractors as workers. The work that subcontractors submit and finish reflects the contractor’s business and will fall directly on the contractors. It is up to contractors to decide if the invoice will reach clients. This is why the subcontractor invoice is important. The subcontractor invoice template allows subcontractors to make sure they are getting paid for the correct amount, and there will not be any confusion between the parties who are involved in the project or job.
Click here to download the word document version of a subcontractor invoice template.