How to Bill Architecture and Interior Design Clients

Billing is where most independent architects and designers lose money — not because they charge too little, but because they pick the wrong fee structure for the project, underestimate scope, or fail to bill for reimbursable expenses they're entitled to.

Here's how to think about each billing method, when to use it, and where the common traps are.

The Four Main Billing Methods

Percentage of Construction Cost

The most traditional method for architecture. You charge a percentage of the total construction cost, typically 5% to 20% depending on project complexity, size, and type.

General ranges:

• Residential (new construction): 8%–15%
• Residential (renovation): 10%–20% (higher because renovations are unpredictable)
• Commercial: 5%–12%
• Interior design (residential): 15%–25% of furnishings/finishes budget

The AIA B101 agreement supports this structure directly. The percentage drops as the project gets larger — a $5M commercial project won't command the same percentage as a $500K house.

The trap: Construction costs change. If the project scope grows, your fee should grow with it. If it shrinks, you eat the loss. Define clearly in your agreement whether "cost of the work" means the initial estimate, the bid price, or the final construction cost. The AIA recommends using the "Initial Information" section to establish a budget baseline and adjustment triggers.

Hourly Billing

You bill for time at agreed rates. Common hourly rates for independent architects and designers:

• Principal/Owner: $150–$300/hr
• Project architect: $100–$200/hr
• Interior designer (principal): $100–$250/hr
• Junior staff/drafting: $75–$125/hr

Hourly works best for projects with uncertain scope — feasibility studies, consultations, construction administration where site visits are unpredictable, or when a client keeps revising.

The trap: Clients hate open-ended hourly billing. Always pair it with a "not-to-exceed" estimate or hourly cap per phase. Otherwise, you'll get pushback on every invoice and the relationship erodes.

Fixed Fee (Lump Sum) by Phase

The most common structure for independent practices. You quote a fixed fee for the entire project, then break it into payments by phase:

| Phase | % of Total Fee | Deliverables | |-------|---------------|-------------| | Schematic Design (SD) | 15% | Concept plans, massing, initial layouts | | Design Development (DD) | 20% | Refined plans, material selections, outline specs | | Construction Documents (CD) | 40% | Full drawing set, specifications, permit-ready docs | | Bidding & Negotiation | 5% | Bid packages, contractor evaluation | | Construction Administration (CA) | 20% | Site visits, RFIs, submittals, punch list |

These percentages are industry standard (AIA guidelines), but you can adjust them. Many independent architects weight CD higher because that's where the real hours go.

The trap: Fixed fee only works when scope is well-defined. If you quote a lump sum for a "kitchen renovation" without specifying the number of revision rounds, meetings, or deliverables, you'll blow past your budget by Design Development.

Hybrid: Fixed Fee + Hourly for Extras

This is what most experienced independents land on. Fixed fee for the defined scope, hourly for anything beyond it — additional revisions, scope changes, extended CA, extra site visits.

The key is defining what's included and what triggers hourly billing before the project starts.

Billing for Revisions Beyond Scope

This is where architects and designers hemorrhage money. The client wants "one more option" or "just a small change" that cascades through your drawings.

Best practice:

1. Define a specific number of revision rounds per phase in your proposal (e.g., "two rounds of revisions included in Schematic Design")
2. State that additional revisions will be billed hourly at your standard rate
3. When the client requests revision #3, send a brief email before doing the work: "This falls outside the included revisions. I estimate 6 hours at $175/hr. Want me to proceed?"

The email takes 2 minutes. It saves you from writing off $1,050 in unbilled work.

Reimbursable Expenses

Reimbursable expenses are costs you incur on the client's behalf, billed at cost or cost plus a markup (typically 10%–15%). The AIA B101 lists standard reimbursables, but make sure your agreement covers:

• Printing and plotting: Large-format prints for review sets and permits ($2–$8 per sheet)
• Travel: Mileage to job sites, parking, tolls (IRS rate: $0.70/mile in 2025)
• Shipping and delivery: Drawing sets, material samples, permit submissions
• Renderings: 3D visualizations if not included in base scope
• Permit and application fees: When you're filing on the client's behalf
• Consultant fees: Structural, MEP, civil engineers — if you're managing them
• Material samples and mockups: For interior design, this adds up fast

The mistake most independents make: They absorb reimbursables because they feel awkward billing $47 for prints. Over a 12-month project, those "small" costs easily reach $2,000–$5,000. Bill them. Your agreement entitles you to it, and clients expect it.

Consultant Pass-Throughs

If you're managing subconsultants (structural engineer, MEP engineer, landscape architect), you have two options:

1. Pass-through at cost: You pay the consultant, bill the client the same amount. Clean, but you're managing the consultant for free.
2. Pass-through with markup: You add 10%–15% to the consultant's invoice to cover your coordination time. This is standard and expected.

Either way, keep consultant fees as a separate line item. Don't bury them in your fee — it makes your work look more expensive than it is, and makes the consultant's cost invisible to the client.

Retainers and Deposit Structure

Standard practice for independent architects and designers:

• Retainer/deposit: 10%–25% of the total fee, due at contract signing
• Phase billing: Invoice at the start or completion of each phase
• Monthly billing: For longer phases (CD and CA), bill monthly based on percentage complete

Never start work without a signed agreement and a deposit. This is non-negotiable for independent practices. The deposit protects you from clients who disappear after Schematic Design with your concepts in hand.

When to Raise Your Rates

If you're consistently running over budget on projects, the problem isn't efficiency — it's pricing. Track your actual hours against your fee on every project. If you're averaging $85/hr effective rate when your target is $150, your fees are too low or your scope definitions are too loose.

The answer is usually both.