Stage payments for building work: how to set them up
A stage payment schedule splits a job into parts and ties each payment to one part being finished. Agree the stages, the amount for each and what "finished" means in writing before work starts. A good schedule means the money you've paid is never more than the value of the work that's been done.
What makes a good stage?
- A clear end point you can both check, ideally something you can see or photograph.
- A price that matches the work in that stage, including the materials it uses.
- A sensible size. Enough stages that neither of you is ever far out of pocket, but not so many that paying becomes a chore.
- Written down, along with how changes will be agreed if the plan moves.
Example stage payment schedules
These are illustrations to show the shape of a schedule, not price guides. Your builder's quote sets the real stages and amounts.
| # | Stage | Finished when… | Payment |
|---|---|---|---|
| 1 | Strip-out and preparation | Old suite removed, room ready for new pipes and wiring | £1,200 |
| 2 | First fix | New pipework and wiring in place, before walls are closed | £2,000 |
| 3 | Boarding and tiling | Walls boarded, tiled and grouted; floor laid | £2,400 |
| 4 | Fit and finish | Bath or shower, basin, toilet and fittings installed and working | £1,600 |
| 5 | Sign-off | Snag list done, room cleaned and handed over | £800 |
| # | Stage | Finished when… | Payment |
|---|---|---|---|
| 1 | Removal and preparation | Old kitchen out, walls and floor ready | £1,500 |
| 2 | First fix | Plumbing, electrics and extraction routed | £3,000 |
| 3 | Units fitted | Base and wall units installed and level | £5,250 |
| 4 | Worktops and appliances | Worktops, sink and appliances fitted and connected | £3,750 |
| 5 | Sign-off | Tiling or splashback, snags fixed, handover | £1,500 |
| # | Stage | Finished when… | Payment |
|---|---|---|---|
| 1 | Groundwork and foundations | Foundations poured and inspected | £9,000 |
| 2 | Walls | Walls built up to roof level | £15,000 |
| 3 | Roof and weatherproofing | Roof on, windows and doors in, watertight | £12,000 |
| 4 | First fix | Plumbing and electrics routed | £9,000 |
| 5 | Second fix and plastering | Walls plastered, sockets, lights and radiators fitted | £9,000 |
| 6 | Completion | Building control sign-off, snags fixed, handover | £6,000 |
Agreeing what "finished" means
Most stage payment disagreements are really about whether a stage is done. You can head these off by agreeing in advance:
- a one-line description of the end point for each stage;
- that the builder will share photos when a stage is complete, especially for work that gets covered up later, like wiring behind plasterboard;
- which stages need a building control inspection before they count as finished, where that applies to your job.
What about materials?
Some stages need expensive materials bought well before the work happens, like a kitchen. You can handle this by buying them yourself, paying the supplier directly, or agreeing a materials payment against a receipt. Whatever you choose, write it into the schedule so it doesn't turn into an unplanned deposit.
When the plan changes
Jobs change: you might add a socket or find rot under a floor. Agree any extra work and its price in writing before it's done, and add it to the right stage. That keeps the schedule matching the real job.
What if a stage isn't finished?
Don't pay for a stage that isn't done. Tell the builder what's outstanding, in writing, and agree when it will be finished. If the work isn't up to standard, the Consumer Rights Act 2015 lets you ask for it to be put right or for some money back. Citizens Advice explains the steps.
How PayTrader handles this
PayTrader is built around paying stage by stage. Your stage plan lives in the app, and each stage is paid just before it starts.
- 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
How many stages should a building job have?
It depends on the size of the job. A small job might be one or two payments; a bathroom or kitchen often works well as four or five; larger projects like extensions usually have more. The aim is that neither side is ever far out of pocket.
Should I hold some money back until the end?
Many people keep a final payment for after the snag list is finished. Whatever you decide, agree it in writing before work starts so it isn't a surprise.
Can the stages change once work has started?
Yes, if you both agree. Put the change and any new price in writing before the extra work is done.
Sources
- Citizens Advice — Before you get work done on your home
- Citizens Advice — Problem with building work, decorating or home improvements
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.