Progress Billing vs. AIA Billing: Key Differences

Progress billing and AIA billing both let you invoice work as it gets done. The difference is the format. AIA billing follows standard G702 and G703 forms, required on many commercial and public jobs. Progress billing is flexible and fits private or smaller projects.

What is progress billing?

Progress billing means you invoice for work as it gets done. You do not wait until the project ends. It keeps cash flowing for you, and owners pay only for verified progress. Read the full guide to progress billing.

• Flexible format that varies by contract
• Invoices reflect percent of work completed
• Common on private, residential, and small commercial jobs
• Helps keep steady cash flow through the project

What is AIA billing?

AIA billing, also called AIA pay applications, follows standard forms from the American Institute of Architects. You use the G702 (Application for Payment) and G703 (Continuation Sheet) to request payment. See how the forms work in our guide to AIA billing.

• Standardized billing with G702 and G703 forms
• Shows retainage, percent complete, and balance due
• Often required on government and large commercial jobs
• Supports lender and audit requirements

What are the key differences?

The biggest difference is structure. Progress billing can be customized. AIA billing follows a strict template. Know which your contract requires before you start invoicing.

• Format: progress billing is flexible; AIA billing uses standard G702/G703
• Use cases: progress billing fits private jobs; AIA billing fits commercial or public work
• Documentation: AIA billing needs a detailed schedule of values and proof
• Compliance: lenders often require AIA billing for financing

When should you use each method?

Pick the method based on project type and who needs to approve payment. Small contractors often prefer progress billing for its flexibility. Switch to AIA billing when a lender, owner, or public contract requires it.

• Residential remodels: progress billing
• Government or publicly funded projects: AIA billing
• Projects with heavy lender involvement: AIA billing
• Small private projects: progress billing

Both methods often hold retainage of 5 to 10 percent. Payment terms are commonly net 30 on either one.

How does software handle both?

Contractor software like Werx handles both progress and AIA-style billing in one system. You can send flexible progress invoices or standard AIA-style pay apps. Werx syncs to QuickBooks so your books stay accurate.

• Create flexible progress invoices or standard AIA-style pay apps
• Track retainage automatically across projects
• Generate professional forms in minutes
• Sync with QuickBooks Online for clean records

Learn more: progress billing and AIA billing.

Key takeaways

• Progress billing is flexible invoicing for work completed
• AIA billing is standardized G702/G703 pay applications
• Progress billing is common on private jobs
• AIA billing is often required on large commercial or government projects
• Werx supports both, with QuickBooks sync and automated forms