How to Invoice for Labor and Materials (Plus Markup)

For plumbers, electricians, contractors, and handymen, almost every invoice combines two things: your time and the stuff you installed. Showing them clearly — and pricing materials properly — makes invoices easier to approve and protects your margin.

Separate labor from materials

List labor and materials as separate lines. Customers trust an itemized bill more than a lump sum, tax often applies differently to each, and you can see at a glance which part of the job made money.

Three ways to bill labor

• Hourly: hours × your rate. Fair for unpredictable work like diagnostics and repairs.
• Flat rate: one price for a defined job, such as replacing a faucet. Customers like the certainty, and you're rewarded for working efficiently.
• Day rate: common for larger projects and crews.

How to list materials

• Itemize significant materials with a quantity and unit price — '50-gal water heater × 1', 'cable (ft) × 45'.
• Group small consumables into one line such as 'fittings and shop supplies'.
• Keep the supplier receipts in case a customer questions a price.

Marking up materials

A markup covers the time you spend sourcing, collecting, and storing materials, plus the risk of warrantying them. The price to the customer is your cost × (1 + markup). Markup is not the same as margin: a 25% markup gives a 20% margin.

Markups vary widely by trade and job size. Pick a policy, apply it consistently, and be ready to explain it if a customer asks.

Handling sales tax

Whether labor, materials, or both are taxable depends on where you work and the type of job. Some places tax materials but not labor; others tax the whole invoice. Check your local rules, then set your tax up once so it applies the same way every time. Invoiceflint lets you save tax presets, and Invoiceflint Pro supports more than one tax on an invoice.

Example: labor and materials on one invoice