Why do busy builders still run short of cash?
Construction is one of the few industries where more work can mean tighter cash. Every new job means paying wages, buying timber, steel, concrete and fixtures, and hiring plant before the first progress claim is paid. On a larger job a business can be carrying several weeks of costs at any moment.
Then there’s retention: a slice of each progress payment held back as security against defects, sometimes until well after practical completion. And since 1 July 2026, Payday Super means super for every employee must generally reach the fund within seven business days of payday — so there’s no quarterly breathing space on that cost either.
How long do the Security of Payment Acts let payers take?
Every state and territory has a Security of Payment Act that gives contractors a statutory right to make progress claims and caps how long payment can take. The main rules on the east coast look like this:
| State | Key rule on payment timing |
|---|---|
| NSW | Under the Building and Construction Industry Security of Payment Act 1999, payment is due within 15 business days for a head contractor and 20 business days for a subcontractor; a payment schedule disputing the claim is due within 10 business days |
| Queensland | Under the Building Industry Fairness (Security of Payment) Act 2017, payment is due 10 business days after the claim if the contract is silent; payment schedules are due within 15 business days; business days exclude 22 December to 10 January |
| Victoria | Amendments that commenced on 15 April 2026 cap payment terms at 20 business days, default to 10 business days where the contract is silent, and exclude the 22 December to 10 January shutdown from business days |
Even at the statutory maximums, a subcontractor claiming monthly can be a month or more out of pocket on every claim — before any dispute, variation or slow approval. Our guide to debtor days and payment claims explains how claims and schedules work.
What about retention and Queensland’s trust accounts?
In Queensland, project trust accounts and retention trust accounts currently apply to Queensland Government contracts of $1 million or more and to private, local government and statutory authority contracts of $10 million or more. The planned extension to smaller private projects was paused by the QBCC in February 2025 pending a wider review. In NSW, head contractors on larger projects must hold cash retention in a retention trust.
Trust rules protect money once it’s held, but they don’t speed up when you get it. Our retention money guide covers the state-by-state detail.
What do trade businesses use funding for?
- Wages and super between progress payments, so the crew is paid every Friday regardless.
- Materials for a new or larger job, especially where suppliers want payment on 30-day end-of-month terms.
- Plant and equipment — an excavator, scaffold, trailer or ute — when a job needs it now.
- Working capital locked up in retention.
- Tax — GST on claims invoiced but not yet paid, PAYG instalments after a strong year, or an ATO debt that crept up during a difficult project.
Which funding structure fits the claims cycle?
A revolving line of credit matches the progress-claim rhythm: draw for wages and suppliers, repay when the claim is paid, draw again next month. Lines of credit are generally unsecured, for businesses usually trading six months or more, with the limit based on turnover and business bank statements. Weaker credit is considered, and decisions are sometimes made the same day. Our revolving business credit page explains how the limit refills.
For larger or one-off needs — buying plant, clearing an ATO balance, funding the start of a big contract — a property-secured loan of $20,000 to $1m provides a lump sum. It’s secured on Australian property you or a supporting party already own, as a first or second mortgage, and needs no financials or tax returns for the initial assessment.
How can you shorten the gap as well as fund it?
- Make valid claims on time. Follow your contract’s reference dates and your state’s rules on what a claim must contain.
- Diarise the response dates. In many states, if no payment schedule arrives in time, the full claimed amount may become payable.
- Track every retention — amount, release trigger and date.
- Price the finance gap into bigger tenders, so the cost of carrying a job is covered.
- Get advice on disputes. This page is general information, not legal advice.
Example scenario
Example scenario — illustrative only. A Brisbane electrical subcontractor wins a fit-out package on a commercial job twice the size of anything it has done before. It needs to buy switchboards and cabling upfront and add two electricians. The owner draws on a line of credit to cover the first two months of materials, wages and super, then repays as monthly progress payments arrive, leaving the facility ready for the next project.
How is pricing worked out?
Every loan is priced on your individual circumstances. We don’t publish rates; we look for the sharpest option available for your business.
Keep the job moving
The 60-second enquiry is free and doesn’t affect your credit score. Tell us about your claims cycle and a lending specialist will contact you to talk through your options.