What Is a Project Timesheet?
A project timesheet is a specialized time-tracking document designed for organizations and professionals who need to allocate working hours to specific client engagements, internal projects, or cost centers. Unlike a standard employee timesheet that tracks total hours for payroll purposes, a project timesheet creates a direct link between time spent and the project or task that consumed it.
The project timesheet is the backbone of time-and-materials billing. When a client agrees to pay for work at an hourly rate, the hours logged on the project timesheet become the basis for invoicing. If you do not track time at the project level, you cannot bill accurately, cannot prove to the client what you worked on, and cannot analyze whether the engagement was profitable.
For internal projects, project timesheets provide the visibility needed to manage budgets, allocate resources, and assess performance. When you know exactly how many hours each phase of a project consumed, you can create better estimates for future engagements and identify process improvements that reduce costs.
Core Components of a Project Timesheet
Project and Task Identification
The project identifier is the most critical field on a project timesheet. Each timesheet row or entry must clearly state which project the time relates to. This is typically done through a project code — a unique identifier assigned when the project is initiated. The project code should be consistent across all team members working on the same engagement to ensure time can be aggregated correctly.
Beyond the project code, a task or phase field helps break down time further. Software development projects, for example, might track time separately for discovery, design, development, testing, and deployment. Marketing projects might track strategy, creative production, media buying, and reporting separately. This granularity allows project managers to identify which phases are consuming the most time and where adjustments may be needed.
Billable vs. Non-Billable Classification
Distinguishing billable from non-billable time is essential for accurate client invoicing and internal profitability analysis. Billable time includes any work that falls within the agreed project scope and can be charged to the client. Non-billable time includes work outside the agreed scope, internal administrative tasks, proposal writing, and time spent on tasks that were not part of the original estimate.
Many project timesheet templates include separate columns or rows for billable and non-billable time, making it easy to generate reports showing total billable hours per project, per client, and per team member. This data feeds directly into utilization metrics that firms use to assess productivity and set performance targets.
Time Allocation by Team Member
When multiple team members work on the same project, the project timesheet must capture each person's contributions individually. This is important for internal cost accounting (knowing how much labor cost was incurred per project), for client transparency (showing the client exactly who worked on their account), and for internal fairness (ensuring work is distributed equitably across the team).
Individual time allocation also enables activity-based costing and skills-based project planning. When you can see that senior consultants consistently exceed estimates on certain task types while junior staff take longer on others, you can refine your project planning and staffing decisions.
Notes and Descriptions
A project timesheet that captures only hours and project codes provides limited value. Including a short description field for each time entry — even just one or two sentences — transforms the timesheet into a meaningful project record. Notes explain what was accomplished, why certain hours were higher than expected, or what decisions were made during a meeting. For clients reviewing invoices, these notes provide context that justifies the hours charged.
Best practices for timesheet notes include describing deliverables completed (not just tasks started), noting any blockers or scope changes that affected the time spent, referencing specific deliverables by name or document title where applicable, and avoiding vague entries like "work on project" or "meeting" without elaboration.
Industry Applications
Software Development and IT
Software projects benefit enormously from detailed project timesheets because development work is inherently difficult to estimate. Tracking time by feature, bug fix, or development phase provides the data needed to improve future sprint planning, identify technical debt that is consuming excessive maintenance time, and justify scope changes to clients when requirements evolve.
Agile and Scrum teams often track time against user stories or backlog items rather than calendar hours. In these cases, the project timesheet can be adapted to capture story points completed or sprint goals achieved alongside or instead of traditional hour tracking.
Marketing and Creative Agencies
Creative agencies face unique time-tracking challenges because a significant portion of creative work is inherently difficult to time-box. A designer working on a brand identity may spend two hours on one concept before discarding it and starting over — yet both the discarded concept and the final work represent valid project time. Project timesheets for creative work should include descriptive notes that capture what was accomplished, not just how long it took.
Marketing agencies also need to track time across multiple channels and campaign phases. A project timesheet structured with separate rows or columns for strategy, creative production, content development, media buying, and analytics provides the granular data needed to optimize campaign performance and justify media spend allocations to clients.
Government and Grant-Funded Projects
Organizations receiving government funding often face strict requirements for documenting time allocated to specific grants or contracts. Project timesheets for grant-funded work typically require more formal approval workflows, clearer linkage between time entries and specific grant deliverables, and segregation of grant-funded time from other organizational activities. Many federal and state grants require timesheet certifications that attest to the accuracy of time recorded and its direct relationship to grant-funded activities.
Sample Scenario
> Scenario: A web development agency is building a custom e-commerce platform for a retail client under a time-and-materials agreement with a $75/hour developer rate and a $150/hour senior architect rate. The project is divided into four phases: discovery, design, development, and deployment. Using a project timesheet template, the team logs time daily with project phase and task codes. During month one, the agency records 340 total hours: 60 hours in discovery (all billable), 90 hours in design (85 billable, 5 non-billable internal reviews), and 190 hours in development (all billable). The client receives an invoice for 325 billable hours totaling $24,375. The non-billable hours are tracked separately for internal analysis, revealing that internal review processes consume more time than estimated — a finding that leads to a process improvement initiative.
Related Templates
- Weekly Timesheet Template — For tracking weekly hours with or without project allocation
- Freelance Timesheet Template — For independent contractors managing multiple concurrent client projects
- Excel Timesheet Template — For a spreadsheet-based approach to time tracking and project allocation
Get Started
Turn hours worked into revenue earned. Download Eonebill's free project timesheet template, start tracking time at the project level, and gain the visibility you need to price projects accurately, invoice clients confidently, and grow your business profitably.
Eonebill connects project timesheet data directly to client invoicing and project profitability dashboards. Log time once, get paid automatically, and see exactly which projects are driving your business forward.