What To Do When a Builder Won’t Pay Your Invoice in Australia

When a builder or head contractor won’t pay your invoice, time matters. The longer you wait, the harder the money is to recover. This guide walks you through what to do from the moment payment is overdue, state by state.

What counts as an overdue invoice in construction?

In most construction contracts, payment is due within 7 to 30 days of the invoice date. If that date has passed and you haven’t been paid, your invoice is overdue. Don’t assume the bill was lost in the post or overlooked—follow a paper trail and act.

Your first step is always to confirm the builder actually received your invoice. Check your email records or get written confirmation. If they say they never got it, resend it certified or by email with a read receipt.

How do I ask a builder for payment without escalating?

Start with a polite written reminder. A phone call is fine, but follow it up in writing—an email counts. Keep it factual: invoice number, date, amount, and the due date.

Example:

“Hi [Name], I haven’t received payment for invoice #XYZ dated [date] for AUD $[amount], due on [date]. Could you let me know the status? Happy to discuss if there’s an issue.”

Give them 5 business days to respond. If they don’t, send a second reminder stating this is a formal notice and you will pursue recovery if payment isn’t received within 7 days.

What is a statutory payment claim under Australian construction law?

Every Australian state and territory has a Security of Payment Act designed to speed up disputes in construction. These acts allow subcontractors and tradies to lodge a formal payment claim that triggers strict legal deadlines on the builder to respond.

A statutory payment claim is not the same as an invoice. It’s a formal legal document that puts the builder on notice they must either pay you or issue a “payment schedule” explaining why they’re withholding money. If they do neither, you can apply for adjudication—a fast, binding decision by an independent third party.

The key advantage: the builder can’t ignore a statutory payment claim the way they ignore invoices.

Which state do I lodge my claim in?

You lodge in the state where the construction work was performed, not where the builder is based. If work happened across two states, you may need to lodge in each.

State/Territory	Legislation	Lodgement body
NSW	Building and Construction Industry Security of Payment Act 1999	NSW Department of Fair Work
VIC	Building and Construction Industry Security of Payment Act 2002	Victorian Building Authority (or private adjudicators)
QLD	Building Industry Fairness (Security of Payment) Act 2017	Queensland Building and Construction Commission
WA	Construction Contracts Act 2004	WA Building Commissioner’s office
SA	Building and Construction Industry Security of Payment Act 2009	SA Commissioner for Public Sector Employment or private adjudicator
TAS	Building and Construction Industry Security of Payment Act 2009	Tasmanian Office of the Ombudsman or private adjudicator
NT	Construction Contracts (Security of Payments) Act 2004	NT Civil and Administrative Tribunal
ACT	Building and Construction Industry (Security of Payment) Act 2009	ACT Disputes Resolution ACT (ACAT)

How long do I have to lodge a payment claim?

This varies by state, but the window is tight. In most states you have between 12 months and 6 years from the date the work was completed or the contract ended.

However, don’t wait. The sooner you lodge, the sooner the legal clock starts ticking on the builder’s obligation to respond. Delays also make it harder to prove the debt was owed on the dates you claim.

What information do I need to include in a payment claim?

A statutory payment claim must include:

• Your name and contact details
• The builder’s or head contractor’s name and contact details
• The contract or purchase order reference
• A clear description of the work performed (or materials supplied)
• The dates work was carried out
• The amount claimed, including any GST
• A breakdown of costs (labour, materials, equipment, or other)
• The date you’re serving the claim
• A statement that the claim is made under the relevant Security of Payment Act

You don’t need a lawyer to prepare this. You can file a payment claim online in minutes—PayClaim handles the formatting and lodgement for a flat AUD $79 across all states.

What happens after I lodge a payment claim?

Once you’ve lodged and served the claim on the builder, they have a legal deadline to respond. Here’s what the law requires:

1. The builder must issue a payment schedule within a set timeframe—usually 10 business days in NSW and QLD, 5 business days in VIC. This document either confirms they’ll pay you, or sets out their reasons for withholding payment.
2. If they don’t issue a payment schedule, you can apply for adjudication without further delay.
3. If they do issue one but you disagree, you can still apply for adjudication within 5–10 business days (depending on the state).
4. An adjudicator will review both sides and issue a binding decision within 10–14 days in most states.

The builder cannot simply ignore your claim. If they fail to respond and you win adjudication, you can enforce the decision through the courts.

What are valid reasons for a builder to withhold payment?

A builder can only withhold payment if there’s a genuine dispute about:

• The quality of work (defects or incomplete work)
• The amount claimed (e.g., you’ve overcharged or double-billed)
• Whether work was actually performed
• Entitlements under the contract (e.g., retention amounts or holdbacks)

They cannot withhold payment because they’re short on cash, waiting for their own payment upstream, or simply disputing your invoice without evidence. This is why the Security of Payment Act is so powerful—it forces them to be specific and transparent.

What is adjudication and do I need a lawyer?

Adjudication is a fast, private process where an independent third party (the adjudicator) reviews your claim and the builder’s response, then issues a binding decision. It typically takes 2–4 weeks from application to decision.

You do not need a lawyer for adjudication. Many tradies and small contractors represent themselves successfully. The adjudicator is used to hearing from non-lawyers and understands construction disputes. You’ll prepare a written submission with supporting documents—invoices, photos, emails, contracts, anything that proves you did the work and deserve payment.

That said, if the amount is large or the dispute complex, legal advice can be worthwhile. Check your professional indemnity or legal expenses insurance—you may have cover.

What does an adjudication cost?

Costs vary by state and adjudicator, but expect to pay:

• Application fee: AUD $200–$600
• Adjudicator’s fee: AUD $500–$2,000+ depending on complexity and the amount in dispute

In most states, if you win, you can recover some or all of your adjudication costs from the builder. Check your state’s legislation for the exact rule.

What if the builder still won’t pay after adjudication?

If you win adjudication and the builder refuses to pay, you have legal enforcement options:

1. File a copy of the adjudication decision in your state’s local court and seek a court judgment. This is usually straightforward if the adjudicator’s decision is clear.
2. Once you have a judgment, use debt recovery procedures—court orders, wage garnishees, or asset seizure—to enforce payment.
3. Consider referring the debt to a debt collection agency if the amounts are large enough to warrant it.

At this stage, legal advice is strongly recommended. A lawyer can file the court order and manage enforcement quickly.

Can I claim interest on overdue invoices?

Yes. Under Australian consumer protection law and most construction contracts, you can claim interest on overdue amounts. The rate is typically 10% per annum, but check your contract—it may specify a different rate.

When you lodge your statutory payment claim, include the original invoice amount plus accrued interest to the date of the claim. The adjudicator will assess whether this is reasonable.

What if the builder disputes the work quality?

If the builder claims the work is defective or incomplete, they must prove it. In adjudication, vague complaints don’t hold up. They need to produce evidence: photos, inspection reports, expert assessments, or specific references to the contract requirements you allegedly breached.

On your side, gather evidence that the work was done correctly: photos during and after completion, inspection certificates, emails confirming handover, or third-party quotes showing the cost of remedial work. If the alleged defect would cost less to fix than your claim amount, the adjudicator will likely award you the full claim minus a reasonable set-off for repairs.

How long does the whole process take?

From invoice to payment can take 2–8 weeks if you move quickly:

• Week 1: Send payment reminders (informal).
• Week 2: Lodge your statutory payment claim.
• Week 3: Builder issues (or fails to issue) a payment schedule.
• Week 4–5: Apply for adjudication if needed.
• Week 6–8: Adjudicator issues decision and builder pays.

If the builder doesn’t comply with the adjudication decision, court enforcement adds a further 2–6 weeks. But the key point: the Security of Payment Act is designed to be fast. There’s no waiting months for a court hearing.

What should I do right now if I’m owed money?

Follow this checklist:

1. Gather all documents: original invoice(s), contract, purchase order, proof of work (photos, timesheets, delivery dockets, emails).
2. Send one final written reminder to the builder stating you will lodge a statutory payment claim if payment isn’t received within 7 days.
3. If no payment arrives, lodge your statutory payment claim immediately. Don’t delay.
4. Serve the claim on the builder via email or post (certified mail is safer).
5. Wait for their response. If they don’t issue a payment schedule by the deadline, apply for adjudication.
6. Prepare a clear, factual submission for the adjudicator. Include all evidence.

Don’t try to chase payment informally for months. The Security of Payment Act is there to protect you. Use it.

Q: Do I have to try to get payment before lodging a statutory payment claim?

No. You can lodge a statutory payment claim immediately once payment is overdue. However, sending a polite written reminder first (even just an email) often prompts payment without the need for formal action. If the builder ignores your reminder after 7 days, lodge the claim. The law is on your side; use it.

Q: What if the builder says they’ll pay but keeps delaying?

Get a new payment date in writing (email counts). If they miss that date, lodge your statutory payment claim. Repeated promises without payment are not a reason to wait indefinitely. Once you’ve given them one fair chance, the claim forces them to either pay or formally explain why they won’t.

Q: Can I lodge a claim for work I did 2 years ago?

Depends on your state. Most Security of Payment Acts allow claims within 12 months of the work completion date, but some extend to 6 years. Check your state’s legislation or PayClaim’s FAQ for your specific timeframe. The sooner you act, the fresher your evidence and the stronger your position.

Q: What if the builder went out of business or can’t pay?

Adjudication can still proceed, and you’ll have a formal decision proving the debt. If the company is insolvent or liquidated, you may be able to lodge a claim in the insolvency. Seek legal advice on your options, as this is complex. At minimum, you’ll have proof of the debt for insurance claims or tax write-offs.

Q: Will the builder be angry if I lodge a claim instead of asking nicely?

Possibly, but that’s not your problem. You’re owed money. The Security of Payment Act exists because the construction industry has a chronic payment problem. Using it is not aggressive—it’s professional and legal. Many builders respect contractors who lodge claims promptly; it signals you’re serious and organised. Don’t let fear of conflict stop you recovering money you’ve earned.

Frequently Asked Questions

How long can a builder legally hold onto my invoice before I can take action?

Payment timeframes vary by state. Under NSW's Security of Payment Act 1999, contractors must respond to claims within 10 business days. Queensland's Building Industry Fairness Act 2017 requires payment within 5 business days of receiving a claim. Victoria's SOP Act 2002 allows 10 business days. Western Australia's Construction Contracts Act 2004 also uses 10 business days. If a builder doesn't respond or pay within these periods, you may have grounds to lodge a statutory payment claim or adjudication application.

What's a statutory payment claim and when should I use one?

A statutory payment claim is a formal demand under your state's Security of Payment Act—it's more powerful than a regular invoice. It triggers strict timeframes for the builder to respond and pay. You'd use one after informal requests fail. Most states require the claim to follow specific formatting rules and be served properly. Once served, the builder must provide a payment schedule or pay within the legislated timeframe (typically 10 business days). If they don't respond properly, you can apply for adjudication, a faster alternative to court action.

Can I apply for adjudication if a builder ignores my payment claim?

Yes. Adjudication is a quick dispute resolution process available under most Security of Payment Acts, including NSW SOP Act 1999, QLD BIF Act 2017, and VIC SOP Act 2002. If a builder fails to respond to your statutory payment claim or disputes it, you can apply to an adjudicator within set timeframes (usually 10 business days of receiving their payment schedule or response). An adjudicator will make a binding decision within 10 business days. This is faster and cheaper than court, though the builder can later challenge it in court if they wish.

What should I include in a statutory payment claim to make it valid?

Your claim must comply with your state's specific requirements. Generally, include: your business details, the builder's details, invoice number and date, itemised work completed or goods supplied, amounts claimed, payment terms, and the period covered. It must be in writing and served properly (check your state's act for acceptable service methods). Many states have prescribed forms available. Errors in format or content can make the claim invalid, so follow your state's Security of Payment Act closely—NSW SOP Act 1999, QLD BIF Act 2017, and VIC SOP Act 2002 all have specific requirements.

What happens if a builder gets an adjudication decision against them but still won't pay?

An adjudication decision is immediately enforceable, even if the builder disagrees. You can take enforcement action without waiting for court proceedings. Options include: issuing a statutory demand (which can lead to insolvency action if unpaid within 21 days), filing a claim in court to enforce the adjudication decision, or seeking a judgment debt. You may also be able to recover legal costs. The builder can later apply to court to set aside the adjudication decision on limited grounds, but they must usually pay the adjudicated amount upfront while that challenge proceeds.