Kill Fee Clause: Why Every Creator Needs One
Last updated: February 2026
You've signed the contract. Blocked your calendar. Started researching the brand. Maybe even shot some test footage.
Then: "Hey, we've decided to go in a different direction. Thanks anyway!"
Without a kill fee clause, you just worked for free.
What Is a Kill Fee?
A kill fee (also called a cancellation fee) is compensation you receive when a client cancels a project after you've committed to it.
It protects you from:
- Brands changing their mind after you've started work
- Budget cuts that leave you holding the bag
- Internal reshuffles that kill campaigns mid-production
- Brands ghosting after receiving drafts
The principle: Your time has value. Once you commit to a project, you've blocked out your schedule and potentially turned down other work. Compensation should reflect that.
Why Brands Cancel Projects
It happens more than you'd think:
- Budget cuts — Marketing budget gets slashed mid-quarter
- Strategy pivot — New CMO wants to go a different direction
- Product delays — Launch pushed back, content no longer needed
- Internal politics — Project loses its champion
- They got cold feet — Saw the draft and panicked
- They were just "testing" — Never serious in the first place
None of these are your fault. All of them cost you time and money.
Standard Kill Fee Structure
Here's the industry-standard approach:
| Cancellation Point | Fee Due |
|---|---|
| After signing, before work begins | 0-15% |
| After work begins, before draft | 25-35% |
| After draft delivery | 50% |
| After final delivery | 100% |
Breakdown
After signing, before work begins (0-15%)
You've committed but haven't invested significant time yet. Some creators charge nothing here; others charge a small booking fee to cover the opportunity cost of holding their schedule.
After work begins, before draft (25-35%)
You've started research, planning, potentially shooting test footage. Real work has happened. 25-35% compensates for that investment.
After draft delivery (50%)
You've created the content. It exists. They've seen it. 50% is fair because you've done most of the work, but they're not getting final deliverables.
After final delivery (100%)
The work is done. You delivered. They owe you the full amount, period.
Kill Fee Clause Examples
Simple Version
Cancellation Policy: If Client terminates this agreement after signing, the following fees apply: Before draft delivery: 25% of total fee. After draft delivery: 50% of total fee. After final delivery: 100% of total fee.
Detailed Version
7. CANCELLATION AND KILL FEE
7.1 Client may terminate this agreement at any time by providing written notice to Creator.
7.2 Upon termination, Client shall pay Creator the following cancellation fees:
- (a) Termination before Creator begins work: No fee due, less deposit (if any)
- (b) Termination after work begins, before draft delivery: 25% of total agreed fee
- (c) Termination after draft delivery, before final approval: 50% of total agreed fee
- (d) Termination after final delivery: 100% of total agreed fee
7.3 "Draft delivery" means the first submission of content to Client for review.
7.4 Kill fee is due within 14 days of termination notice.
7.5 Upon payment of applicable kill fee, Client receives no license to any created content.
Agency Version (More Protective)
Cancellation: This agreement may be cancelled by either party with 7 days written notice. Upon cancellation:
- Creator retains all deposits paid
- Client pays for work completed at time-and-materials rate ($X/hour)
- Minimum cancellation fee: 25% of total contract value
- After draft approval: 75% of total contract value due
- Client receives no usage rights to any content created
How to Negotiate Kill Fees
If the Brand Pushes Back
They say: "We can't agree to pay for work we don't receive."
You say: "The kill fee compensates for my time and the opportunity cost of blocking my schedule. I may have turned down other projects to accommodate this one. It also protects both of us — it ensures you're committed to the project, and I'm committed to delivering."
They say: "We've never paid a kill fee before."
You say: "Professional creators include cancellation protection in their contracts. It's industry standard, similar to how hotels charge for late cancellations. I'm happy to discuss the specific terms, but some form of protection needs to be included."
They say: "What if we just don't like the content?"
You say: "That's what the revision process is for. The kill fee covers cancellation — meaning you've decided not to move forward with the project at all, not that you want changes. If you'd like revisions, those are included."
When to Be Flexible
- Long-term client relationships (reduce percentages slightly)
- Very large contracts (may negotiate lower percentages on higher absolute values)
- Trusted brands with track records
When to Hold Firm
- First-time clients
- Brands with questionable reputation
- Complex or time-intensive projects
- Rush projects where you blocked other work
What Happens to the Content?
This matters. Clarify in your contract:
Option 1: No Rights Transfer
Upon payment of kill fee, Client receives no license to any content created. Creator retains all rights and may repurpose content as they see fit.
This is the standard approach. They cancelled — they don't get the content.
Option 2: Limited Rights at Higher Fee
Upon payment of kill fee at 75% or above, Client receives a non-exclusive license to use draft content for internal purposes only. No public use permitted.
Some brands want this option. Charge more for it.
Option 3: Full Rights at Full Payment
Upon payment of 100% of contract value as kill fee, Client receives all rights as originally agreed.
If they pay in full, they get what they paid for.
Real-World Kill Fee Scenarios
Scenario 1: Early Cancellation
Situation: You've signed a $500 contract. Brand emails the next day saying they've changed their mind.
Kill fee: 0-15% = $0-75
Outcome: You're out one day of time. Move on, lesson learned about vetting clients.
Scenario 2: Mid-Project Cancellation
Situation: You've researched the brand, planned your shots, and filmed 2 of 3 videos. Brand says budget got cut.
Kill fee: 25-35% = $125-175
Outcome: Doesn't cover all your time, but provides some compensation. You keep the footage for your portfolio.
Scenario 3: After Draft Delivery
Situation: You've completed all 3 videos and sent for approval. Brand says they're "going in a different direction."
Kill fee: 50% = $250
Outcome: Fair compensation. The work exists. They could theoretically use it, so 50% protects both parties.
Scenario 4: They Ghost After Final Delivery
Situation: You delivered final, unwatermarked videos. Brand stops responding to emails.
Kill fee: 100% = $500
Outcome: Chase payment. Send invoices. Document everything. This is breach of contract.
Kill Fee Best Practices
1. Get Deposit Upfront
A 50% deposit reduces your risk. Even if they cancel, you've already been partially paid.
2. Use Watermarked Previews
Never send final, unwatermarked content until you have payment (or until contract is well-established with trusted client).
3. Define "Draft" Clearly
What exactly counts as draft delivery? First submission? First revision? Be specific to avoid disputes.
4. Put It in Every Contract
Even for small projects. Especially for new clients. The one time you skip it will be the time you need it.
5. Invoice Promptly on Cancellation
When they cancel, send the kill fee invoice immediately with clear reference to the contract clause.
What If They Refuse to Pay?
Steps to take:
- Send formal invoice referencing contract clause
- Follow up in 7 days, then 14 days
- Send demand letter (template available online)
- Report to creator communities (optional, but valid)
- Small claims court (for larger amounts)
Document everything. Screenshots of the contract, all communications, the cancellation notice.
Kill Fee Checklist
Before signing any contract, verify:
- Kill fee clause is included
- Percentages are defined at each stage
- "Draft delivery" is clearly defined
- Payment timeline for kill fee is specified
- Content rights upon cancellation are addressed
- You're getting at least 25% upfront as deposit
Summary
A kill fee isn't about punishing brands. It's about respecting your time and creating fair terms for both parties.
Any professional brand will understand and accept reasonable cancellation terms. If they don't, that tells you everything about how they'll treat you during the project.
Protect yourself. Put it in writing. Get paid for your commitment.
Related: 10 Clauses Every Contract Needs | How to Handle Scope Creep