Kill Fee and Cancellation Clauses for Freelancers

Clients cancel projects for reasons that have nothing to do with you: budgets get cut, priorities change, a company is acquired, a launch is postponed indefinitely. When that happens without a cancellation clause, you're left negotiating payment for work that the client has already mentally written off. That's a weak position.

A kill fee (also called a cancellation fee) solves this by agreeing, before work begins, how much you're owed if the client ends the project early. It isn't a penalty. It's payment for work already done and for time you reserved and can't easily resell.

The terms overlap, but it helps to separate two situations:

• Kill fee: the project is stopped after work has started. Common in writing, design, and illustration. Usually a percentage of the total fee, based on how far the work has progressed.
• Cancellation clause: the booking is cancelled before work starts. Common for events, photography, workshops, and any work tied to a specific date. Usually tied to how much notice was given.

Many contracts include both.

There's no universal standard, but these ranges are widely used and easy to justify to a client:

1. Cancelled before work starts: the deposit is kept, nothing further owed.
2. Cancelled during work: payment for all work completed to date, or a fixed 25-50% of the total fee — whichever is greater.
3. Cancelled after final delivery: the full fee is owed. The work is done.
4. Date-based bookings: more than 30 days' notice, deposit kept; 14-30 days, 50% of the total; under 14 days, 100%.

The closer to the end of the project (or the booked date), the higher the fee — because the less realistic it is for you to replace that work.

Sample clause:
"Either party may end this agreement with written notice. If the Client ends the project after work has started, the Client will pay (a) for all work completed up to the date of notice at the agreed rates, or (b) a kill fee of 30% of the total project fee, whichever is greater, plus any approved expenses already incurred. The deposit is non-refundable and is credited against these amounts. Ownership of any work completed transfers to the Client only after this payment is received."

Two details matter here: the "whichever is greater" wording protects you both early and late in the project, and ownership only transfers on payment — so a client can't cancel and then use the half-finished work for free.

Sample clause:
"If the Client cancels the booking: more than 30 days before the booked date, the deposit is retained and no further fees are owed; 14 to 30 days before, 50% of the total fee is owed; fewer than 14 days before, the full fee is owed. One reschedule with at least 14 days' notice is permitted at no cost, subject to availability, within 12 months of the original date."

Offering a reschedule option often defuses a cancellation entirely: many clients will move the date rather than pay a fee.

A fair contract works both ways. Add a line on what happens if you can't continue: you'll deliver work completed to date and refund any payments for work not yet performed. Clients notice fairness, and a balanced clause is harder to argue with than a one-sided one.

A kill fee you have to invoice after a cancellation still depends on the client paying it. A deposit collected up front doesn't. That's why the two work best together: the deposit covers early cancellations automatically, and the kill fee covers the rest. For typical deposit sizes, see how much deposit freelancers should charge.

This article is general information, not legal advice. In some places, fees that look like penalties rather than a genuine estimate of your loss may not be enforceable — keep them proportionate, and check locally for high-value contracts.

Our general freelance service agreement template includes termination and kill-fee terms you can adapt, and date-based templates like event services include cancellation windows. With Clinch, your client signs from their phone with no account and pays the deposit at signature — so if a project is cancelled later, the first part of your fee is already covered.