Last updated November 6, 2026
General information, not tax or legal advice. The rules depend on your country and your situation, so check anything with a tax or legal consequence with your accountant.
A rate increase letter states the new rate, the date it applies and what's unaffected, in a few plain sentences, with enough notice for the client to plan. Give at least 30 days, or whatever your contract requires. Check the contract first. Don't apologise, and don't list every reason.
What should a rate increase letter include?
A rate increase letter should include the old rate, the new rate, the date, and what the change doesn't touch. That last part is what most clients read first, because it answers "what about the work I've already booked?" Add a named person to call, and a reference to the contract clause if there is one.
Leave out the long justification. One true sentence is enough. If you mention costs or inflation, make sure the claim holds up, because the client may check it.
How much notice should you give clients?
The notice you give clients should follow your contract first and good manners second. Where the contract is silent, 30 days is a common minimum, and the bigger the client, the longer they'll need to get a change through their budget.
| Client | Notice | What to watch |
|---|---|---|
| Contract with a price-change clause | What the clause says | Follow its method and its dates exactly |
| Fixed-term contract, no clause | None you can impose | Raise it at renewal, or ask for agreement |
| Monthly retainer or rolling agreement | One full billing cycle, ideally 60 days | Make sure the notice period runs out before the new invoice |
| Project by project | 30 days | Honour quotes already sent, until they expire |
| Large client with an annual budget | 90 days, before their budget round | Ask when that is |
| Private consumers | Read your terms and the local rules first | A term letting you raise a price without a right to cancel may be unfair (Directive 93/13/EEC, Annex, point 1(l)) |
Rate increase letter templates you can copy
These rate increase letter templates cover the three situations most firms have. The figures are invented, so replace them with your own.
For an hourly client:
Dear [name],
From 1 March 2027, our rate for [service] will change from €80 to €88 per hour, plus VAT. Work already quoted or booked before that date stays at the current rate.
We review our rates each year, and this is the first change since March 2025. Your contact and your payment terms stay as they are.
If you'd like to talk through what this means for your upcoming work, call me on [number] or reply to this email.
Kind regards, [name]
For a retainer client:
Dear [name],
Under clause [number] of our agreement dated [date], this letter gives 60 days' notice that your monthly retainer will change from €2,000 to €2,200, plus VAT, starting with the invoice for May 2027. The 20 hours it includes stay the same.
If you would rather keep the fee and reduce the hours, tell me by 1 April and we'll change the scope from the same date.
Kind regards, [name]
For a project client with a live quote:
Dear [name],
Quote QUO-2026-0091 stays at the agreed price if accepted by its expiry date, 31 January 2027. From 1 February, new quotes will use the attached rates, which are about 10% higher than last year's.
Kind regards, [name]
Send it as its own message. Tucked into the footer of an invoice, or into a quiet line on the invoice itself, an increase reads as if you hoped nobody would notice. For how to word the invoice email itself, see invoice email templates.
How much work can you lose before a rate increase costs you money?
You can lose more work than most people expect before a rate increase costs you money. The break-even share is the increase ÷ (100 + the increase). This is arithmetic, not a forecast of what your clients will do.
| Increase | €80 an hour becomes | Work you can lose and still bill the same |
|---|---|---|
| 5% | €84 | 4.8% |
| 10% | €88 | 9.1% |
| 15% | €92 | 13.0% |
| 20% | €96 | 16.7% |
Take an invented firm billing 1,000 hours a year at €80, which is €80,000. After a 10% rise, 909 hours at €88 brings in €79,992, about the same, with 91 hours free. Those hours can go to better clients, or to work you can't currently fit in. If you aren't sure the rate itself is right, work it out from your costs with the charge-out rate guide.
What should you do when a client pushes back?
When a client pushes back, hold the rate and offer to change the scope. Dropping the price for whoever complains teaches every client to complain.
I understand it's not welcome. The new rate stands for all our clients from 1 March. If the budget is fixed, I can suggest ways to reduce the work so the monthly cost stays where it is. Would it help to go through that on a call?
You can also phase it in for a long-standing client, with half the rise now and half in six months, provided you put both dates in writing. And some clients will leave. Decide before you send the letters which ones you'd let go, so you aren't deciding on the phone.
The mistakes that make a rate increase harder
- Changing the rate on an invoice without telling anyone. This is the one that loses clients. The accounts team will reject the invoice as well.
- Backdating it. An increase applies from a date after the notice, never before.
- Emailing your largest clients in a mail-out. Ring those first, then follow up in writing.
- Forgetting your own documents. Live quotes, retainer invoices and your price list all need to change on the day. A monthly retainer is the one most often missed.
- Waiting too long. A 30% rise after five years without a change is a far harder letter than a small one each year.
Changing your rates in ERPFlow
In ERPFlow, a service holds its price, so change it in one place and every new line picks it up. What already exists keeps its own price: an issued invoice is final, and a quote keeps the prices it was written with.
Recurring invoices hold their own lines too, so a service price change doesn't touch them. Edit each recurring invoice before the run that should carry the new fee. Every customer on one schedule gets identical lines, so a customer moving to a different price at a different date needs a schedule of their own.
ERPFlow doesn't write or send rate letters, and it has no bulk email, so these go out from your own mailbox. The customers list helps you prepare: its Revenue column sorts, which shows you who to phone first, and a CSV export gives you the addresses. Attach the sent letter to the customer's record, so the notice you gave is on file.