A Freelancer’s Guide to Billable Expense Income

Freelancer’s guide to billable expense income

With more and more people transitioning to the gig economy to become freelancers, there are also more and more freelancers who do not have experience running their own business. As anyone who has run their own business will tell you, charging fully for your services is essential. Luckily the ingredients for this are the same in all professions, and one of the key things to remember is charging your clients for billable expenses. This guide will show you what you need to know to get those numbers working in your favour.

What are billable expenses, anyway?

Essentially, these are costs you’ve incurred while providing a service for your client, and which your client can reasonably be expected to pay. Let’s go into more detail about that, and give you some tips on how to manage them – and your clients’ expectations. While it is often ignored by beginners or those who worry about your rates, it’s important to get a handle on it from the beginning so it doesn’t come back to bite you later!

Examples of billable expenses you can charge for

One of the hardest things to get your head around is what, exactly, billable expenses are when it comes to client-specific charges. Here are some examples you can use to get an idea of what you can charge for additionally as a freelancer.

Miscellaneous charges:

Regardless of your industry, you may be entitled to bill your client for travel and accommodation, office supplies, couriers and more, outside of your own fee.

Marketing and advertising:

Another expensive area for freelancers can be anything to do with advertising placement and production as well as printing, stock image subscriptions and other details you use to get the word out for your client.

Industry-specific charges:

App designers will need to charge for hosting platforms, photographers will charge for equipment hire, and graphic designers will charge for paid features such as fonts.

“Above and beyond” work time:

From phone calls and emails to other work you had to do to iron out the details for a project, you could be able to charge for that time. Depending on your industry, you may be able to include additional time at your hourly rate for project management, or you may need to consider increasing your hourly rate a little to cover these costs. Either way, you should ensure you’re not short-changed for the work you do.

How do you charge for billable expenses?

The best way to charge for these kinds of extra fees is to be upfront about them. Explain the charges and how they’re broken down, and make sure that your customer is clear on why they are built into the price that you are presenting to them. Clarity and honesty are important, after all.

If possible, itemize the billable expenses on your estimate. Or if the actual costs are unknown before you start, make sure you include a note that sundry expenses will be charged at cost, and ensure you get your client’s approval before you start work on the project. This will prevent any negative surprises and also helps show your level of professionalism. For extra protection, you could ask you client to sign a simple contract before beginning.

You have a right to receive income that takes into account your billable expenses. Even if your rates are higher than your competitors it’s for a good reason, and you will be financially protecting yourself from all sides.

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