FreshBooks · Projects

How to Fix FreshBooks Project Billing Error

A project invoice bills the wrong amount, expenses do not reach the client, a fixed-price project bills like an hourly one, or the project shows a budget overrun that makes no sense.

At QuickFix Bookkeeping, the setting that governs everything here: the project billing method. Hourly, flat rate, and per-service each behave completely differently at invoice time. A flat-rate project that was set up as hourly will happily bill your client for every tracked hour, which is a conversation nobody wants to have.

What Causes This

Wrong billing method

Hourly, flat rate, and project rate behave differently. The wrong one produces a plausible but wrong invoice.

Expenses not marked billable

A project expense not flagged billable is absorbed by you and never reaches the client.

No markup applied

Rebilled expenses passed through at cost, with no markup, quietly erode your margin.

Budget set wrong

A budget in hours compared against a flat-fee project produces meaningless overrun warnings.

How to Fix It

METHOD 1Set the Right Billing MethodInvoice amount is wrong
1

Open the project and check the billing method. Hourly bills tracked time at a rate. Flat rate bills a fixed fee regardless of hours. Project rate bills a single rate for all time on the project.

2

A fixed-fee engagement set up as hourly will bill every tracked hour, and you will not notice until the client does.

3

Changing the method does not retrospectively fix invoices already issued. Correct those separately.

METHOD 2Rebill Project ExpensesCosts never reach the client
1

When you record an expense, tick Billable and assign it to the client and project. An expense that is not marked billable is absorbed by your business permanently.

2

Apply a markup if your agreement allows it. Passing costs through at exactly cost is a decision, and it should be a deliberate one, not an accident of a blank field.

3

When you invoice the project, billable expenses pull in alongside billable time. If they do not appear, they were not marked billable.

METHOD 3Fix Budget and Overrun WarningsBudget alerts make no sense
1

Check whether the project budget is set in hours or in money, and whether that matches how the project is actually billed.

2

An hours budget on a flat-fee project tells you when you are losing money on the engagement, which is genuinely useful. A money budget on an hourly project tells you when you are about to exceed the client's cap. They answer different questions, so pick deliberately.

METHOD 4Reconcile Before You InvoiceCatch it before the client does
1

Before invoicing a project, open it and review unbilled time and unbilled expenses together. Confirm the rates, confirm what is billable, and confirm nothing was billed on a previous invoice. See our time tracking guide for the time side.

Fixed Price Is Where Margin Dies

On an hourly project, an overrun bills itself. On a flat-fee project, every hour past the estimate comes straight out of your margin, silently, and you only find out at the end. Track time on fixed-fee work even though you are not billing it hourly. It is the only way to know whether the work was actually profitable, and whether the next quote should be higher.

Related Guides

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