Fixed Fee Contract Line: What Is It & How Does it Work in PSOhub?

Published: 1 June 2026

Audience

Admin
Controller
Project Manager

Objective

Understand what a Fixed Fee contract line is, how it differs from other contract line types, and how it affects budgeting, time tracking, and invoicing in PSOhub.

Introduction

A Fixed Fee contract line is a billing structure in PSOhub where the customer is charged a set amount for a defined scope of work — regardless of the actual hours spent delivering it.

This model is common in project-based businesses where scope and price are agreed upfront. The fee is fixed, so the financial commitment is clear for both your team and your customer from the start of the project.

Fixed Fee lines sit within a Contract Group inside a project. Together with Time & Materials, Expenses, Retainer, and Product lines, they form the financial structure that drives billing and revenue tracking in PSOhub.

How a Fixed Fee Contract Line Works

When you add a Fixed Fee line to a contract, you define the agreed amount to invoice your customer. This amount does not change based on the hours your team books — time entries are tracked against the line, but they do not affect the invoiced amount.

This separation between effort tracking and billing is what makes Fixed Fee lines distinct. Your team can log time freely, and PSOhub records it under Used in the Financials and Contract tabs, giving you full visibility into the effort spent without altering the commercial agreement.

Fixed Fee contract line fields

Each Fixed Fee contract line contains the following financial fields:

Field	Description	Type/Values	Notes
Amount	The agreed amount to invoice your customer for this scope of work.	Currency	Fixed and not impacted by actual hours booked. This value drives invoicing regardless of time spent. Changes should only be made if the commercial agreement with the customer is updated.
Budget (Sales)	Your internal budget based on the selling rate. Use the Budget Grid to calculate and populate this field automatically.	Currency	Used for internal revenue planning and performance tracking. Helps compare planned vs actual delivery value. Should align with the scope defined in the fixed fee agreement.
Budget (Costs)	Your internal budget based on the cost rate. Used for margin and profitability tracking.	Currency	Critical for assessing project profitability. Ensure this reflects realistic delivery effort, as underestimation can lead to misleading margins in fixed fee projects.
Total Value	Reflects the value of the contract line. Equal to the Amount field and contributes to the Total Project Value shown in the project's general information.	Currency	Always mirrors the Amount field in fixed fee setups. Used in reporting and dashboards; does not change based on time entries or actual costs.

Using Fixed Fee Lines for Non-Billable Time

A Fixed Fee contract line can also be used to track time that is not billable.

If you set the Amount field to zero, PSOhub will continue to track any time booked against the line — but it will exclude the line from invoicing. This is useful for internal work, overhead tasks, or any effort that your team needs to log without generating a charge.

Budget Alerts

You can configure one or two budget usage alerts on a Fixed Fee contract line. When the value of hours booked reaches the defined percentage threshold, PSOhub:

Displays a message in the project's Activity feed
Sends a notification and/or email to any team member with Alerts enabled on the project
Highlights the line in the contract with an orange warning icon once the threshold is reached or exceeded

This gives project managers early visibility into budget consumption before an overrun occurs.

Deactivating a Line on Budget Overrun

In addition to alerts, you can enable Deactivate the contract line on budget overwrite. When this option is active, PSOhub prevents any further time entries once the budget is fully consumed.

This is a useful safeguard for Fixed Fee projects where scope control is critical.

📌 Note: If a Fixed Fee contract line is configured as a recurring or installment invoice and is deactivated, it will no longer be invoiced going forward.

Activating and Deactivating a Contract Line

The Active toggle controls whether your team can book time or expenses against a contract line.

When you set a project to Active, all contract lines are automatically activated. To prevent bookings on a specific line — for example, if a phase is complete or on hold — uncheck the Active box on that line. Team members will no longer be able to select it when logging time or expenses.

📌 Note: The Active toggle only appears once the project itself has been set to Active.

Adding the Line to a Task List

When creating your project's plan, you can add a Fixed Fee contract line directly as a task list. This is useful when you are not using a Plan template or when you want to link a task list to a specific contract line for tracking purposes.

Invoicing a Fixed Fee Contract Line

The Invoicing tab on the contract line defines how and when the fixed amount is billed. PSOhub supports the following invoicing methods for Fixed Fee lines:

Manual — you trigger the invoice when ready
100% on completion — PSOhub invoices the full amount when the line is marked complete
Recurring fixed fee — the amount is invoiced on a set schedule
Installments — the amount is split and invoiced in stages

If your organization uses an accounting integration, you can override the default revenue account set in the Global Settings > Financial Settings > GL Accounts and select an alternative from the GL Name / Article / Item / Service / Product drop-down on the Invoicing tab. You can also assign a specific tax category to the line here.

Discounts

Discounts can be added to a Fixed Fee contract line and applied at the point of invoicing. For full instructions, see Add a discount to an invoice.