Passing tool costs to clients: tracking them per card
Freelancers often pay for software on a client's behalf. A card per client makes those costs easy to recover.
In this guide
Freelancers and small agencies often pay for things on a client's behalf: an ad budget, a stock photo licence, a premium plugin, a hosting plan, a font, a testing tool for one project. The cost is real, the client agreed to cover it, and yet it regularly goes unbilled because the receipt got lost among a dozen others on the same card. A card per client fixes that. Whatever that card pays for is, by definition, that client's cost, the receipts are already grouped, and billing them back becomes a five-minute task at the end of each month.
Agree the rules with the client first
Before spending anything on a client's behalf, agree in writing:
- Which costs are billable: ads, software, licences, hosting, travel booked online.
- Whether you add a handling fee or markup on pass-through costs, and how much.
- Whether card fees are billable. The issue fee and top-up charge on the client's card are a real cost of paying on their behalf. Many freelancers include them as a line item or build them into the handling fee.
- Approval limits: anything above a set amount needs the client's approval first.
- Who owns accounts and licences after the project ends.
A short paragraph in your contract or proposal covers this and prevents awkward conversations later.
Setting up a client card
- Estimate the pass-through costs for the next month or project phase, plus a margin.
- Order a card sized for that amount. The order total is the balance plus 15% of it plus $5.00; check it with the pricing calculator.
- Name the card's purpose in your card logbook with the client's name and the card ending.
- Use the card only for that client.
- Add the card to the client-related accounts, using the billing address shown with the card.
Paid orders are usually checked and issued within a few hours. If a client wants to fund the budget in advance, ask for payment before you order the card. That keeps your own cash out of their costs.
Keeping receipts tidy
Create a folder per client. Each time the card pays for something, save the receipt there, renamed with the date, merchant and amount. Many tools let you add a company name or a reference to invoices: use the client's name or project code, so receipts are self-explanatory. For ad platforms, download the monthly invoice.
Billing it back
At month end, or at each project milestone:
| Step | What to do |
|---|---|
| 1 | Open the client folder and list every receipt for the period |
| 2 | Add the amounts; check against what the card's balance suggests |
| 3 | Add the agreed handling fee and any card fees |
| 4 | Add the costs to your invoice as separate lines, with receipts attached |
| 5 | Note in the logbook that these costs were billed |
Attaching receipts saves the client from asking for them and makes approval faster. If costs were in another currency, show the original amount and the dollar amount charged; see currency differences for why they differ.
Ad budgets for clients
Ads are the most common and most volatile pass-through cost. A client card for ads lets you set the platform's spending limit below the card balance and know that a runaway campaign cannot spend more than the client agreed. Spend caps and card balances explains the setup. For larger budgets, many clients prefer to add their own card to their ad account instead; that is often cleaner, and worth suggesting.
When the project ends
- Cancel or transfer subscriptions and licences the client will keep, so they are billed to the client directly from now on.
- Remove the card from all client-related accounts.
- Bill any remaining costs.
- Decide what to do with the remaining balance. It can pay for another planned cost, or, if the card was never used, its balance can be refunded in full under our rules; used cards with at least $500.00 left can be refunded minus 10%. Fees are not refunded. Refund math has examples.
Why not use one business card for everything?
You can, and many freelancers do. The cost is time: separating client costs from your own at month end, finding lost receipts, and explaining to a client why one invoice has a charge from a different project. With several active clients, the extra issue fees for separate cards usually cost less than the time they save. One big card or several covers the trade-off in general.
Taxes
How pass-through costs are treated for tax depends on your country and your contract. In some places they are your expense and your income; in others they are reimbursements. Ask your accountant once, then follow the same approach every month. Tax season prep covers record-keeping.
Quick answers
Can the client pay for the card directly?
The card is issued to your account. If the client wants cards in their own name and control, they can open their own account.
Should card fees be passed on?
That is between you and the client. Agree it up front and be consistent.
See how it works for ordering.
BuyVCC Team
The people who review BuyVCC orders write these guides from the questions customers send us. Notice something outdated? Let us know.