Is an advance payment legally binding?

For the client, yes — they have paid and can expect delivery. For you, also yes — you must deliver or repay the advance. Always document the scope of the advance payment clearly to avoid disputes.

How do I handle VAT on a progress bill?

VAT is due at the time of invoicing, not at the time of payment. Each progress bill triggers VAT on the amount invoiced.

Progress billing, advance payments, and final invoices

How progress billing and advance payments work for Swiss sole proprietorships — and how to record them correctly in your bookkeeping.

1 min read

When does a progress bill make sense?

Progress billing (Teilrechnung) is useful for long projects: you don't issue a single invoice after completion, but several during the project. This improves your cash flow and reduces the risk of total default.

Advance payment vs. progress bill

An advance payment (Akonto) is paid before work begins — it covers your initial costs and demonstrates the client's solvency. A progress bill is paid after a completed milestone. The final invoice (Schlussrechnung) reconciles everything: total price minus advance payment and progress bills = remaining amount.

Recording in bookkeeping

Advance payments and progress bills are recorded as income when they arrive — not when the project is complete. This is the cash-basis principle (vereinnahmt). The final invoice then references the earlier payments so all parties have a complete summary.

Accurate as of: The rates and amounts mentioned in this article reflect the state as of 7 August 2026. They are for information only and do not replace tax or legal advice. For binding information, contact the Swiss Federal Tax Administration (ESTV), your cantonal tax office, or a fiduciary.

Frequently asked questions

Is an advance payment legally binding?: For the client, yes — they have paid and can expect delivery. For you, also yes — you must deliver or repay the advance. Always document the scope of the advance payment clearly to avoid disputes.
How do I handle VAT on a progress bill?: VAT is due at the time of invoicing, not at the time of payment. Each progress bill triggers VAT on the amount invoiced.