Builder deposits: how much is normal?
Citizens Advice says to keep a builder's deposit as low as you can and not to agree to more than 25% of the price of the job. Plenty of jobs need a much smaller deposit, or none at all: if the deposit is for materials, you can often buy them yourself or pay the supplier directly, then pay for the labour stage by stage.
Why builders ask for a deposit
A deposit usually covers one of two things: booking the builder's time, so they can turn down other work, or buying materials before the job starts. Both are fair reasons. What matters is that the amount matches what it's for, and that it's written down.
How much is too much?
Citizens Advice's advice is to push the deposit down as much as possible and not agree to more than 25% (Citizens Advice). If a builder wants more than that before any work is done, ask what it's for. If the answer is materials, ask to see the costs or buy them yourself.
Red flags
- A large deposit with no clear reason, or pressure to pay it today.
- Cash only, or payment into a personal account that doesn't match the business name.
- No written quote, or no written description of what the deposit covers.
- No business address or landline you can check.
- Reluctance to agree stage payments for the rest of the job.
Safer ways to cover the builder's upfront costs
| Option | How it helps |
|---|---|
| Buy the materials yourself | They stay yours if the job doesn't go ahead. |
| Pay the supplier directly | The money goes where it's meant to go, and you get the receipt. |
| Make the first stage small | You pay for early work once it's done instead of a lump sum up front. |
| Use a held payment (escrow) service | The builder can see the money is there, but it's only released when the work is approved. |
If you do pay a deposit
- Get a receipt that says what the deposit is for, plus receipts for any materials it pays for.
- Pay by credit card if you can. Section 75 can help if the job costs between £100.01 and £30,000, even if only the deposit went on the card.
- Ask whether the deposit is protected. Citizens Advice suggests checking if the trader has insurance that returns your deposit if they go out of business.
What if the builder takes the deposit and doesn't start?
Contact them in writing, give a clear date to start or refund the deposit, and keep copies. If you cancel, Citizens Advice notes a builder may keep some of the deposit to cover genuine losses, like materials already bought for your job, but you can negotiate if that seems unreasonable. If you can't agree, you can make a claim through the court (see GOV.UK).
How PayTrader handles this
PayTrader is built around paying stage by stage. Instead of a big deposit, you pay for each stage just before it starts, and it is held until you approve the finished work.
- You and your tradesperson agree the job as stages, each with its own price.
- You pay for a stage before it starts. The money is held by our regulated payment provider — PayTrader never holds it.
- When the stage is done, your tradesperson sends photos through the app.
- You approve, and that stage is released to them. If you don't approve or raise an issue within 14 days of the stage being marked complete, it releases automatically; raising an issue stops the clock.
PayTrader is launching in the UK soon, for a small fee on each stage.
Join the waitlistRelated guides
Common questions
Is a 50% deposit normal for building work?
No. Citizens Advice advises not agreeing to more than 25%. If a builder asks for half up front, ask what it covers and whether you can buy materials yourself or pay in stages instead.
Do I have to pay a deposit at all?
Not always. It depends on the job and what you agree. Smaller jobs often need no deposit, and on larger jobs the first stage payment can do the same job as a deposit.
Can I get my deposit back if I cancel?
It depends on your agreement and when you cancel. A builder may keep enough to cover genuine losses, such as materials already ordered for your job. Check your written agreement and talk to them first.
Sources
- Citizens Advice — Before you get work done on your home
- Citizens Advice — Cancelling building or decorating work
- GOV.UK — Make a court claim for money
This guide is general information, not legal or financial advice. The figures and court limits above apply in England and Wales unless we say otherwise; rules differ in Scotland and Northern Ireland. If you're unsure about your situation, Citizens Advice can help for free.