A kill fee is the money a client owes when they cancel after work has started. Pair it with a 25-50% deposit collected up front. On a $6,000 project cancelled after $2,400 of work, completed work plus 25% of the remaining $3,600 is $3,300. Without those clauses, the freelancer often leaves with an apology.

TL;DR

A kill fee covers work begun. A cancellation fee covers time blocked before work starts. A deposit is money already in the account. Write all three into the contract before the first hour is billed. New York's Freelance Isn't Free Act (statewide since August 28, 2024) requires a written contract for most jobs of $800 or more, which is where these numbers belong. Invoice the kill fee the day the project dies, with a card payment link. A $3,300 balance at 2.9% is a $96 fee and $3,204 paid, not another 39-day wait.

What is a kill fee, and how is it different from a deposit?

These three terms get mixed together. They protect different moments.

A kill fee is owed if the client cancels after work has begun. The term comes from magazines, which have paid writers a portion of a commissioned fee (commonly a quarter to half) when a piece is killed before publication. SitePoint and other contract guides treat the same idea as standard in design, development, and photography.

A cancellation fee is owed if the client pulls out after the agreement is signed but before work starts. The freelancer already declined other work to protect the calendar. That lost week is real money even if no files were delivered.

A deposit is paid before any work, usually 25-50% of the project fee, and kept if the project dies. Delivvo's 2026 contract guide puts it bluntly: a kill fee is a debt the client owes after they have already walked away. A deposit is money the freelancer already holds.

Payment terms decide this before the first invoice. Handshake projects are the ones that vanish unpaid.

How much should a kill fee be on a real project?

Vague language ("a reasonable fee if cancelled") is an argument, not a clause. Three structures show up in actual contracts.

Flat percentage: 50% of the full fee if work has started. On a $4,000 job cancelled in week two, the client owes $2,000.

Tiered by phase: 25% during discovery, 50% after midpoint, 100% in the final phase. A $12,000 site billed in three $4,000 milestones that dies after milestone two has already collected $8,000 if those invoices went out.

Completed work plus 25% of the remainder: on a $20,000 project with $8,000 done, that is $8,000 + $3,000 = $11,000.

Write the trigger in the same sentence as the number. Fourteen days from the cancellation date is tighter than Net 30. Clockify puts the global average from invoice to payment at 39 days. A killed project that then sits in accounts payable is a second cash-flow problem.

Why cancelled work wrecks cash flow even when the client is "nice"

Late invoices already chew through freelance cash. Bonsai found 85% of freelancers deal with late payments, and 29% of invoices arrive at least one day past due. QuickBooks' 2025 data, still cited into 2026, put average unpaid invoices at about $17,500. Clockify found 42% of freelancers have missed personal bills because a client paid late.

A cancellation without a clause is worse than a late invoice, because there is no due date to point at. The freelancer did the work, turned down other clients, and now has neither the original fee nor a replacement booking. Freelancers Union research has put the average annual loss from unpaid freelance work around $6,000. One killed $6,000 project with no deposit can be that entire year in one email.

A developer blocks three weeks for a $6,000 dashboard rebuild. Week one is a prototype worth $2,000. The client pauses until next quarter. No deposit, no kill fee. The freelancer can invoice $2,000 and hope. The other two weeks are empty, and the leads that would have filled them already hired someone else.

Same job with a 50% deposit ($3,000) collected by card before kickoff. That $3,000 is already in the account. A $3,000 deposit on PayFly at 2.9% is an $87 fee and $2,913 the same week, not a Net 30 promise. The empty calendar still hurts. The rent check does not.

What the law actually requires (and what it does not)

This is not legal advice. It is the public rule set freelancers keep citing in 2026, and it belongs in the same conversation as the clause.

New York State's Freelance Isn't Free Act took effect statewide on August 28, 2024. The New York State Department of Labor requires a written contract for most freelance work of $800 or more, stating rate, method, and payment date. Hiring parties that fail to pay as agreed can face double damages and attorney's fees. NYC's city version, enforced by DCWP, uses the same $800 threshold (including work that adds up to $800 in any 120-day period). If there is no payment date, payment is due within 30 days after the work is completed.

Los Angeles and several other US cities have similar ordinances. Thresholds differ. A kill fee, a cancellation fee, and a non-refundable deposit belong in that written contract, next to how often invoices go out and the late-fee line.

What to do the day a client cancels

Send the invoice the same day, not after a cooling-off week. Itemize completed work. Quote the clause. State the due date. Attach the payment link.

If there was no clause, still invoice for completed work with delivery evidence. Delivvo's guidance matches what most freelancers already learn the hard way: clients often pay for work they received. They resist open-ended "you owe me for the next two weeks" demands that were never written down.

If the invoice goes unpaid, the chase is the same as any other late bill. Late payment follow-up is a separate problem. The kill fee's job is to make the first invoice exist.

A $1,000 true-up at 2.9% is a $29 fee and $971 received. Waiting on a check for a killed project is how a $1,000 gap turns into a credit-card float.

Sample clause to adapt (not legal advice)

"If the Client cancels after work has begun, the Client shall pay all work completed through the cancellation date plus 25 percent of the remaining contracted fee. The deposit paid at kickoff is non-refundable once work has begun and is credited against amounts owed. Sums due under this clause are payable within 14 days of the cancellation date by the methods listed on the invoice."

Put the same numbers on the invoice. A clause the client never sees again is a clause they will pretend not to remember.

FAQ

What is a freelance kill fee?

A kill fee is money the client owes if they cancel after work has started. It covers completed work and the calendar the freelancer blocked. Magazines have used a quarter-to-half fee for killed pieces for decades. The same clause belongs in design, development, photography, and consulting contracts.

How much should a kill fee be?

Flat 50% after work begins, a phase schedule (25 / 50 / 100), or completed work plus 25% of the remainder. On a $6,000 project with $2,400 done, completed work plus 25% of $3,600 is $3,300.

Is a deposit the same as a kill fee?

No. A deposit is collected before work and kept. A kill fee is invoiced after cancellation. Use both. A 25-50% deposit is the floor that does not need chasing.

Does New York's Freelance Isn't Free Act cover cancelled projects?

The statewide law, in effect since August 28, 2024, requires a written contract for most freelance work of $800 or more, including rate, method, and payment date. A kill fee written into that contract is part of the agreed terms. NYC's city law also allows double damages for unpaid work. This is not legal advice.

What if the contract has no kill fee and the client cancels?

Invoice completed work immediately, itemized, with proof of delivery. Protection for blocked time is weak without a written clause. Put the deposit and kill fee in the next contract before the next kickoff.

How fast should a kill fee invoice get paid?

Write 14 days from cancellation into the clause. The Clockify global average from invoice to payment is 39 days. A card link on the invoice is how that number drops. A $3,300 kill fee at 2.9% is $96 in fees and $3,204 paid.

Send the invoice with a Pay now link the day the project dies. A dead project can still pay.