Kill Fee Calculator
Calculate a fair kill fee when a client cancels a freelance project mid-way. Applies industry-standard 25-50% rates by phase plus work completed and opportunity cost.
What Is a Kill Fee and When Does It Apply?
A kill fee is a cancellation payment owed to a freelancer when a client terminates a project before completion. It protects the freelancer from losing revenue on blocked calendar time and compensates for work already performed. Industry standards place kill fees between 25% and 50% of the total project fee, rising as the project progresses. Writing kill fee terms into every contract prevents expensive disputes when cancellations happen — and they do happen, to roughly 1 in 5 freelance engagements.
This calculator produces a defensible kill fee based on three components: the value of completed work, an opportunity-cost premium for the displaced pipeline, and an administrative fee for wrap-up, archiving, and file handover. The result is a fair number you can quote to a client or insert directly into a cancellation clause. Typical outputs range from 25% of the total fee at the proposal stage to 75%+ near delivery.
Industry Standards by Phase
Kill fees vary by industry, but the benchmarks are consistent across design, development, writing, and video production. At the proposal-accepted phase, 25% of the total fee is standard (most of it is opportunity cost, not completed work). By milestone 1, kill fees rise to 30-40%. Mid-project (milestone 2), expect 50-60%. Near delivery, kill fees climb to 75-90%, because you've done nearly all the work and absorbed full calendar risk. Video and software tend to sit at the higher end because their work products are harder to reuse; writing and design sit at the lower end because assets are often partially reusable.
Proposal Accepted — ~25%
Milestone 1 — ~35%
Milestone 2 — ~50%
Milestone 3 — ~65%
Near Delivery — ~85%
How the Formula Works
Completed Work = Total Fee × (% Work Completed / 100)
Opportunity Cost:
Opportunity Cost = Total Fee × Phase Multiplier
Administrative Fee:
Admin = Total Fee × 5%
Recommended Kill Fee:
Kill Fee = min(Completed Work + Opportunity Cost + Admin, Total Fee)
When to Use This Calculator
Use this calculator in two situations. First, when drafting a contract: quote a kill fee table covering each milestone so the client knows the cost of cancelling at every stage. This alone reduces cancellation rates because clients think more carefully before pulling the plug. Second, when a cancellation actually happens: run the numbers, prepare a clear breakdown, and send an invoice. Clients are far more likely to pay when the fee is itemized with a reference to the signed contract.
Example Scenarios
Example 1: A $5,000 logo design project, 60% complete, cancelled at Milestone 2. Completed work: $3,000. Opportunity cost: $750. Admin: $250. Recommended kill fee: $4,000 (80% of total). Example 2: A $20,000 software project, 20% complete, cancelled at Milestone 1 by the client. Completed work: $4,000. Opportunity cost: $3,960. Admin: $1,000. Recommended kill fee: $8,960 (45% of total).
Estimates for planning only. Rates and terms may vary by jurisdiction and contract.
Frequently Asked Questions
What is a typical kill fee percentage?
Industry standard is 25-50% of the total project fee, scaled by how far the project has progressed. At the proposal-accepted phase, 25% is common. By mid-project, 50% is standard. Near delivery, kill fees can reach 75-90% because the freelancer has absorbed nearly all the time cost and produced most of the deliverables. Design, writing, video, and software all fall in the 25-50% baseline range, with video and software trending higher because their work products are less reusable.
Should I always include a kill fee clause in contracts?
Yes. A kill fee clause protects both parties. For the freelancer, it guarantees compensation for blocked calendar time and work performed. For the client, it sets clear expectations and prevents ugly disputes later. Contracts without kill fees often end in lose-lose scenarios where the freelancer is stiffed and the client feels guilty. Build a simple table into your Statement of Work showing the kill fee at each milestone (for example, 25% at proposal accepted, 50% at milestone 2, 75% at final review). Review it with the client at signing so nothing is a surprise.
How do I calculate opportunity cost for a cancelled project?
Opportunity cost represents the revenue you could have earned by taking other work during the blocked period. A reasonable proxy is 20-25% of the total project fee at the start (when almost no work is done but you blocked the time) declining to 5-10% near delivery (when most of the time has been converted to deliverables). This calculator applies a phase-based multiplier to approximate this. If you turned down specific alternative work, you may be able to claim that revenue as actual damages instead.
Can the client refuse to pay the kill fee?
Only if the clause was not in the signed contract or if the cancellation was due to your breach (missed deadlines, poor quality, etc.). If the kill fee is documented and the cancellation was at the client's discretion, you have a legal right to collect. Small claims court handles these disputes routinely for amounts under $10,000. Always get a signed contract with the kill fee table before starting work, and invoice promptly after cancellation with a detailed breakdown of completed work plus the contractual kill fee.
What if I already received a deposit?
Most freelancers take a 25-50% deposit at project start. This deposit should be non-refundable and counts toward the kill fee. If the calculated kill fee equals $5,000 and you already hold a $2,500 deposit, you invoice the balance ($2,500). If the kill fee is less than the deposit, industry norm is to keep the full deposit anyway because you blocked the calendar time. Make this explicit in the contract: "Deposit is non-refundable and applies toward any kill fee owed."
Should I hand over work-in-progress files after a kill fee is paid?
Yes, once the kill fee is paid in full, you typically hand over completed work products associated with the paid portion. Write this into the contract: "Upon payment of kill fee, freelancer will deliver all completed deliverables and raw files for paid portions of the project." Do not hand over files before payment clears. For design and writing, partial handover is workable; for video and software, handover of incomplete builds is often impractical and the contract should say so.