UK Trade Pricing and Paperwork Glossary
Plain-English working definitions. Exact legal, tax and accounting meaning can depend on context; use qualified advice where necessary.
- Estimate
- An informed indication of likely price when some details remain uncertain. Example: a range pending inspection.
- Quotation
- A defined price for a defined scope, subject to its wording, assumptions and applicable law.
- Invoice
- A request for payment identifying supplied work, amount and payment details.
- Pro forma invoice
- A preliminary payment document that is not normally the final tax invoice; confirm accounting treatment.
- Labour rate
- The amount charged for working time, which may need to support wages, non-billable time and overhead.
- Materials
- Items incorporated into or purchased specifically for the job.
- Consumables
- Small items used during work, such as tape, blades, cleaners or fixings.
- Overhead
- Business costs not easily assigned to one job, such as insurance, vehicles and administration.
- Markup
- Profit expressed as a percentage of cost.
- Margin
- Profit expressed as a percentage of selling price.
- Gross profit
- Selling price minus the defined direct/cost base, before other business expenses and tax.
- Net price
- A price before VAT in VAT examples; clarify because “net” can be used differently.
- VAT
- A UK consumption tax. Use the business’s actual VAT status and current official guidance.
- Deposit
- An upfront payment, often connected to booking or materials, with clear terms required.
- Staged payment
- A payment due at an agreed milestone or date during longer work.
- Balance due
- The remaining amount after deposits, stages or credits are deducted.
- Payment terms
- The agreed timing, method and conditions for payment.
- Scope of work
- The written description of included work and deliverables.
- Exclusions
- Work, products or risks explicitly not included in the stated price.
- Variation
- An agreed change to scope, price or timing after the original document.
- Validity period
- The period for which a quotation or offer remains open.
- Call-out charge
- A charge for attendance that may cover availability or initial travel.
- Travel charge
- A separately identified allowance for time, mileage, fuel or transport.
- Contingency
- A transparent allowance for defined uncertainty, not a substitute for scoping.