Billing software for lawyers in Canada: Features that matter most

Modern lawyers and law firms now use several tools to run their practice more efficiently, improve their cash flow, and make things easier for their clients. One of these tools is billing software for lawyers, which can simplify daily work for legal professionals.

In this article, we look at billing software programs for lawyers and law firms, how these tools work, and the key features to consider. Whether you're a solo practitioner, a firm manager, or exploring new options for your team, this article is for you.

How does billing software for lawyers work?

Billing software is a tool that lawyers and their firms use to:

• record billable hours for a specific matter and client
• streamline time tracking, billing, invoicing, and payment processes

These processes are time-consuming and need financial expertise, but billing software can make these tasks easier and more efficient. Billing software can reduce the time legal professionals spend on billing-related tasks with its features and functions.

It also improves the client experience when they pay your firm or manage questions about their accounts. Think of it as a two-sided tool: it saves time for you and makes billing smoother for your clients.

Billing software programs can either be a standalone product offering only billing features or a part of a legal practice management software (PMS).

Watch this video to see how billing software automates tasks in a lawyer's daily work:

Bookmark our Legal Technology page for more modern solutions designed for Canadian legal professionals and law firms, including billing software for lawyers.

Benefits of billing software for lawyers

Billing software programs offer several benefits for lawyers and law firms. One example is Clio's legal management software, which comes with legal billing and invoicing feature, and provides these benefits:

• creating bills faster: as its name suggests, one basic benefit of billing software is that it can produce client bills faster than manual methods
• easily bill clients: when you generate a bill, you can send it to clients in a few clicks, and they can pay you through the billing software's automated payment plans
• customizable solutions: billing software can be customized, including client invoices and billing plans, to fit your firm's needs

What are the key features of billing software for lawyers?

Below are some key features to look for in billing software for lawyers, along with software examples.

Automated time tracking

Before you issue an invoice, it's important to track the time that you spent on a particular file, matter, or client. This helps ensure that the invoice is accurate and based on actual recorded time.

One example is CosmoLex's legal management software. It provides a time and expenses tracking feature. With this time-tracking tool, you can access these advantages:

• automated time capture: after it is set up, the time-tracking tool runs as you work on a matter and pauses when you stop working
• mobile timekeeping: even when you're working out of the office, the tool can be accessed via mobile app
• accurate time tracking: billing software records in real time, reducing errors
• flexible time entry: the software allows you to set weekly and monthly time entry preferences that suit your workflow

These features reduce manual time tracking, helping ensure that no time is left unrecorded and directly link the recorded time to a specific matter.

Automated and compliant invoicing

Once you have the accurate time entries for a specific matter and client, you can proceed to billing and invoicing, which sits at the heart of billing software for lawyers.

Invoicing and e-billing management are the core features of Aderant Expert's BillBlast, which is available to Canadian lawyers and law firms. BillBlast creates and emails invoices to your clients individually.

Here are the other features of BillBlast:

• automated invoice delivery: with its automation feature, you can produce and send email invoices to your clients quickly
• centralized proof of delivery: the billing software has a centralized repository of sent items, bounce backs, and client replies
• email billing compliance: the email invoices you create can follow client-defined formats and can be sent in line your clients' requirements

With this billing software for lawyers, you can reduce the risks of billing delays and rejections due to incorrect or missing data in your invoices.

Accepting payments from clients

Billing software for lawyers also helps you accept client payments, especially through online channels such as credit cards.

Here's a video from LawPay on how its billing software helps with credit card processing fees:

Check out our Practice Management page for more news about the legal profession and insights from legal experts on ways to improve one's routine tasks.

Handling clients' trust accounts

Some billing software programs have built-in legal trust accounting software to improve how you handle your clients' trust accounts. One example is PracticePanther practice management software.

Here are some of the software's trust accounting features:

• reconciliation with matters: everything related to finances (e.g., billing, collections, and trust accounting) is integrated into one software system, which you can be easily reconcile with specific contacts and matters
• separate ledgers for every account: while finances are integrated in this billing software, you can still keep separate trust and operating ledgers, allowing you to track transactions per contact, matter, or account
• automated alerts on balances and requests: you can also set up automatic notifications (e.g., when trust account balances fall below your defined threshold) and send trust requests to clients via email, text, or through PracticePanther's client portal

Billing software for lawyers can also be integrated with the platforms you're already working with. For example, PracticePanther's trust accounting software syncs with QuickBooks and Trustbooks.

Financial reporting

Billing software for lawyers can also create financial reports. Using these reports, you or your law firm can track performance in areas such as payment collections and client turnover.

LawPay is one of the software programs with a financial reporting feature, allowing it to:

• generate detailed reports: you can decide what information goes into the financial report, such as specific time frames, transaction statuses, or other custom tags
• create different types of reports: you can also generate different reports according to your needs, such as:
  • accounts receivable and aging invoice reports
  • trust account activity and summary reports
  • time and expense reports

Using this financial reporting feature, you can make management decisions based on actual financial data, as it shows you where your firm stands financially.

How to choose the right billing software for lawyers in Canada?

Choosing the right billing software is a major decision. It will take time to learn a new system and will require a financial investment. Other factors you need to consider are:

• standalone or part of a PMS: billing software is available as a standalone product or a feature in a legal PMS; decide whether you want full practice management package or just the billing feature
• costs: because there's no free option at scale, your firm should budget for subscription or licence costs; in return, billing software helps you organize revenue and expenses and unlocks additional features, such as reporting and integrations.
• free trials and demos: if you're still unsure which software is best for your firm, you can book free demos; many billing software providers also offer a free trial

Billing software for lawyers: Improving invoicing and financial management

Today, lawyers and law firms do not need to deal with issues brought by manual processes and stacks of financial documents just to prepare invoices for clients. By using the right billing software for lawyers, many long‑standing billing challenges are reduced, giving clients a smoother experience and freeing lawyers to focus more on legal work.

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