How to get paid faster as a tradie

Agree the terms before you start

There is no law setting a standard payment term for private customers in Australia. business.gov.au says payment terms form part of the sales contract, so what you agree is what applies. That makes the quote the best place to set them.

Write down when payment is due (on completion, or a set number of days after the invoice), how the customer can pay, and what happens if they pay late. business.gov.au gives 7, 14, 21 or 31 days as examples. Many trades ask homeowners to pay on completion or within 7 days, and give commercial accounts 14 to 30 days. That is common practice, not a rule.

Take a deposit, within the rules

A deposit covers your materials and shows the customer is committed. For ordinary service jobs there is no national cap, but consumer regulators advise customers to pay no more than about 10% up front, and a business must not take payment and then fail to do the work.

Residential building work is different: most states cap deposits by law, and the cap can apply to plumbing, electrical, carpentry and landscaping work when it counts as building work. The caps, with sources, are in our guide to quotes and estimates. For longer jobs, progress payments at agreed stages keep money coming in without a big deposit.

Invoice the same day

An invoice sent from the van at the end of the job is paid while the customer still remembers how pleased they were. One sent two weeks later competes with every other bill. If you can, invoice on the day the work is done.

Get it right first time. A business customer needs a valid tax invoice to claim their GST credit, and will send back one that is missing your ABN or the GST. If your ABN is missing altogether, the ATO says a business paying you generally must withhold 47% of the payment. Our tax invoice requirements guide has the full checklist.

Make paying the easy part

• Put one clear total and the due date at the top, not buried under the line items.
• Print your BSB and account number and your PayID, so the customer can pay from their banking app in a minute.
• Add a payment link for card payment for customers who prefer it.
• Use your invoice number as the payment reference, so you can match the payment to the job.
• Send the invoice where the customer will see it: email, or the same thread they first contacted you on.

Remind before the due date, then after

Most people who pay late have forgotten, not refused. business.gov.au suggests starting with a polite reminder by phone or email. A simple rhythm that works for many businesses:

• A few days before the due date: a friendly heads-up with the amount and a payment link.
• The day after it is due: “This invoice is now overdue”, with the details again.
• A week later: a firmer reminder, and a phone call if it is a large amount.
• Two weeks later: a final reminder that says what happens next.

Keep every reminder polite and factual. A customer who feels harassed pays last, and debt collection conduct towards consumers is regulated.

Repeat work: let it charge itself

For regular work, such as fortnightly cleans, lawn rounds or quarterly pest treatments, chasing each invoice by hand wastes everyone’s time. Ask the customer once for permission to charge a saved card, then charge it when each invoice is issued. Or send one invoice a month covering all the visits, so the customer has a single bill to pay.

Late fees and interest: only if agreed in advance

Unless your terms say so, you cannot add interest or a late fee. business.gov.au’s letter-of-demand checklist says to include a late-payment interest rate only if it was specified in the contract. So if you want the option, put it in your quote terms before work starts.

Keep it reasonable. The ACCC can now seek large penalties for unfair terms in standard-form contracts with consumers and small businesses, a change that took effect on 9 November 2023. A late fee far beyond your real cost, or a term that lets you keep a whole deposit for any breach, is the kind of term the ACCC treats as risky.

When reminders are not enough

business.gov.au sets out the usual next steps:

• A letter of demand. State the amount, what it is for, the date it must be paid by, and what you will do if it is not. Send it by registered post.
• A debt collector or legal action, usually through your state’s small claims tribunal or court for smaller amounts.
• Writing it off, if chasing would cost more than the debt.

Do not threaten what you will not do, contact people at unreasonable times, or mislead them about consequences. The ACCC and ASIC debt collection guideline sets out what is acceptable when chasing consumers.

Subcontracting on building jobs

If you work as a subcontractor in construction, every state and territory has security of payment laws. Under the NSW model, for example, you can serve a payment claim, the head contractor has 10 business days to respond with a payment schedule or becomes liable for the full amount, and “pay when paid” clauses are banned. Details differ by state, so check your own state’s rules.

Government and big business customers

Commonwealth agencies must pay supplier invoices within 20 calendar days on contracts up to A$1 million, or 5 days for eInvoices where both sides use eInvoicing, and pay interest when they are late. Large businesses report how quickly they pay small businesses under the Payment Times Reporting Scheme. If you win this kind of work, send invoices exactly as their purchase order asks, because a wrong reference resets the clock.

Why chasing matters at BAS time

If you account for GST on an accruals basis, you report the GST when you issue the invoice, not when you are paid. An invoice still unpaid at BAS time means paying the ATO GST you have not collected yet. Our GST for tradies guide explains cash and accruals.

How Karya Falak helps you get paid

• Raise a tax invoice from the finished job, with your ABN, the GST and your payment details filled in from your settings. See invoicing.
• Your BSB, account number and PayID print on your invoices, and you can add an Australian payment slip at the foot. These payments are marked paid by hand.
• Customers can pay by card, PayTo or BECS direct debit through your own Stripe account, where it has them switched on. See online payments.
• Reminders go out on the days you choose before and after the due date, and stop once the invoice is paid.
• Saved cards and auto-pay charge repeat work when each invoice is issued.
• Deposits are paid when the customer accepts a quote.
• Customers see and pay their invoices in their client hub.
• The aged money owed report shows who owes what, and payments recorded in Xero or QuickBooks come back to the job.