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On a materials-heavy job a deposit protects your cash. For home building work the law caps it, and the cap depends on your state.
On a big job with a lot of materials, a deposit protects your cash. For home building work the law caps it. It's 10% in New South Wales, 5% to 20% in Queensland depending on the price, and 5% or 10% in Victoria.
Small jobs, big jobs
The NSW Government says a deposit is unlikely on a small job like changing a powerpoint or unblocking a pipe, and more usual where materials are a large part of the cost. In Queensland, work of $3,300 or less can carry up to 20%. That drops to 10% up to $19,999 and 5% over $20,000.
Insurance comes first
In New South Wales, jobs over $20,000 need home building compensation cover, and you can't ask for a deposit until the customer has the certificate. In Victoria, domestic building insurance applies to work over $16,000, and customers are told not to pay a deposit until they've seen the certificate.
Then get paid as you go
After the deposit, progress payments follow the work. In Queensland you can't claim more than half the price, deposit included, until at least half the work on site is done. In Victoria the law sets the stages, which are base, frame, lock-up and fixing.
For a Victorian contract covering every stage, the usual schedule is 10% at base, 15% at frame, 35% at lock-up and 25% at fixing. In New South Wales, progress payments are fixed amounts after set stages, or paid as work is done and costs come in, backed by invoices or receipts.
One exception, and one warning
Queensland allows up to 20% when customised or prefabricated work done off site is more than half the price, like made-to-measure cabinetry or a shed. And if a customer pays more than the lawful deposit in Queensland, they can't recover the excess through the home warranty scheme. In Victoria, insurance may not cover advance payments. Keep to the cap.
More detail and each state's official page are in our guide: Deposits and progress payments. It's general information, not legal advice.
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