How much deposit should I pay a builder?
A guide to deposits, stage payments, retention, and protecting yourself if things go wrong.
Standard UK practice
Most reputable UK builders work on stage payments rather than large upfront deposits. A typical structure for a £40,000 extension:
- 10% deposit on contract signing — covers initial materials + scaffold delivery
- 20% on foundations complete
- 20% on shell complete (walls + roof on)
- 20% on first fix complete (electrics + plumbing roughed in)
- 20% on second fix complete (plaster, tiles, kitchen, bathrooms)
- 5–10% retention held back for 2–4 weeks after completion to cover snagging
Red flags
- Asks for >25% upfront before any work starts
- Asks for 100% before completion
- Cash-only payment
- No written contract or formal quote
- Pressure to pay quickly "for materials"
- Different bank account name to the company name
- No insurance details on quote
Big materials = different rules
For projects with big upfront material costs (kitchens, bathrooms, bespoke joinery), a larger deposit may be reasonable but should be itemised:
- Kitchen ordered: customer might pay for the kitchen direct to the supplier
- Bathroom suite ordered: same approach
- Aluminium bi-folds: 50% deposit to manufacturer is normal
This is different from paying the builder 50% upfront. Pay material suppliers directly where possible, then the builder is paid for labour + general materials.
Protections
- Written contract — minimum a JCT Building Contract for Home Owners or a clear scope-of-works + payment schedule signed by both
- Bank transfer with reference — paper trail. Avoid cash.
- Build warranty / insurance — some builders offer 6–10 year build warranties through providers like Buildcert, Buildzone, or LABC Warranty
- Credit card for the deposit — if you can pay the deposit on a credit card (some builders accept), Section 75 protection covers you up to £30k if the builder goes bust before delivering
- Federation membership — FMB (Federation of Master Builders), TrustMark, or similar gives some recourse
If a builder refuses stage payments
Walk away. Reputable builders are familiar with stage payment structures and will accept them. Anyone who insists on a large upfront payment with no protection is a serious red flag.
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Frequently asked questions
10–15% in most cases. 25% only if materials genuinely need pre-ordering.
Usually a sign of tax fraud + no paper trail = no recourse. Avoid.
No. Hold back 5–10% retention for 2–4 weeks until snagging is complete.
If you paid by credit card (deposit only), Section 75 covers you to £30k. Otherwise you're an unsecured creditor — typically lose any work-in-progress payments.
Related
Last reviewed: May 2026 · This information is general guidance and not legal advice.
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