Getting paid: grant claims, receipts and reports

Most grants don't arrive as a lump sum on day one. Usually you pay for project costs first, then send the funder a claim with receipts and proof of payment, and they reimburse their share. Many programs also keep a holdback until your final report is accepted, so plan your cash flow before the project starts.

Each program sets its own payment rules in the contribution agreement and applicant guide. This post explains how the process usually works, so you know what to ask and what to prepare.

Do grants pay upfront or after you spend?

It depends on the program and the agreement. The common patterns are:

• Reimbursement. You spend, then claim. This is the most common approach for business grants.
• Advance payments. Some programs, often for non-profits and community projects, pay part upfront and ask you to account for it later.
• Milestone payments. Money is released when you reach agreed steps, such as finishing a prototype or opening a space.
• Rebates. Many energy rebates pay once the work is finished and checked.

Your agreement says which one applies. If an advance isn't offered, ask whether it's possible. Some funders will consider it for organizations with limited cash.

What goes into a claim?

A claim is your request to be paid for costs you have already incurred. Funders usually ask for:

• A claim form listing each cost, matched to your approved budget lines.
• Invoices and receipts showing what was bought, from whom and when.
• Proof of payment, such as bank statements or cancelled cheques. An invoice alone often isn't enough.
• Payroll records for wages, if staff time is part of the project.
• A short progress update explaining what was done in the period.

Only eligible costs inside the project dates count. Costs from before your start date are usually not covered; see apply before you spend.

What is a holdback?

A holdback is part of the funder's contribution that they keep back until the end. It's released once you finish the project and your final report is accepted. It gives the funder confidence that the project will be completed and reported properly.

The size of a holdback varies, so check your agreement. The key point for planning: you won't see that last part until after the project ends, sometimes well after.

What reports will you have to file?

Reporting is part of the deal. Expect some mix of:

• Progress reports during the project, often with each claim or at set intervals.
• A final report when the project ends, describing what you did, what you spent and what results you achieved.
• Results reporting after the project, in some programs, for example on jobs created, sales or community reach.

Keep notes as you go. It is much easier to write a final report from a running log of activities, photos, numbers and receipts than to reconstruct everything at the end.

Can a funder audit you?

Yes. Most agreements let the funder, or someone acting for them, review your records during the project and for some time afterwards. An audit usually checks that costs were real, eligible, paid and not funded twice. See stacking rules for why that last point matters.

To be ready:

1. Keep every receipt, invoice, contract and timesheet, organized by claim.
2. Keep records for as long as your agreement says.
3. Use a separate project code or account so project costs are easy to pull out.
4. Note any change to the plan and the funder's approval of it.

If an audit finds ineligible costs, the funder may reduce payment or ask for money back.

How do you plan cash flow for a grant?

Because most money comes after you spend, a funded project can strain your bank account. Plan for it:

• Map the timing. List when you'll pay each cost and when you expect each payment back. Allow for processing time.
• Cover the gap. Use savings, a line of credit or a loan if needed. Our post on grants, loans and tax credits explains how they can work together.
• Count your own share. Under cost-sharing, part of each cost is always yours.
• Plan for the holdback. Treat it as money that arrives late.
• Claim on time. Late or incomplete claims slow everything down.

Building this into your project budget from the start makes approval and delivery easier. Funders often ask how you'll fund the project while you wait for reimbursement.

What if your project changes?

Plans shift: a supplier raises prices, a hire falls through, a timeline slips. Tell your funder early and ask for an amendment before you change spending. Moving money between budget lines or extending the end date usually needs written approval. Changing things without approval can make costs ineligible.

To find programs that fit your project, use the eligibility check, or browse funding for small businesses and non-profits. If you're still waiting on a decision, see what happens after you apply.

Frequently asked questions

How long does it take to get paid after a claim?

It varies by funder and depends on how complete your claim is. A claim with clear receipts and proof of payment is processed faster. Ask your program officer what to expect.

Can I claim costs before my agreement is signed?

Usually not. Most programs only cover costs incurred within the project dates set in the agreement. Check the agreement and the program page.

What happens if I spend less than budgeted?

You are generally paid only for eligible costs you actually incurred, so the funder's payment goes down too. Some funders let you move unspent money to other approved lines with permission.

Do I have to pay a grant back?

A non-repayable grant usually isn't paid back if you follow the agreement. You may have to return money for ineligible costs, missing reports or a project that isn't completed. Some programs offer repayable contributions instead, which you do pay back.