What payment schedule is normal for a renovation project?

In Ottawa, a typical renovation payment schedule should never exceed 10% down payment, with progress payments tied to completed work milestones - anything asking for large upfront payments is a major red flag.

Standard Ottawa Renovation Payment Structure

The most common and safest payment schedule for Ottawa renovations follows this pattern:

Initial Payment: Maximum 10% down payment or $1,000 (whichever is less) when signing the contract. This covers initial material orders and shows your commitment to the project.

Progress Payments: Payments should align with completed work stages, typically:

• 25% when materials are delivered and work begins


• 25% at rough-in completion (framing, electrical rough-in, plumbing rough-in)


• 25% when drywall and painting are complete


• 25% final payment upon project completion and your satisfaction

Material Handling: For major material purchases (custom cabinets, special-order items), it's acceptable to pay the supplier directly rather than giving cash to the contractor. Always get receipts showing materials are allocated to your project.

Ontario's Construction Lien Act Protection

Under Ontario's Construction Lien Act, you're entitled to hold back 10% of each payment for 60 days after project completion. This "holdback" protects you from liens if the contractor doesn't pay their suppliers or subcontractors. Many Ottawa homeowners don't know about this right, but it's powerful protection.

Red Flags in Payment Requests

Be extremely cautious of contractors who want:

• More than 10% upfront


• Payment for work not yet completed


• Full payment for materials before delivery


• Cash-only payments


• Payment to personal accounts rather than business accounts

Legitimate Ottawa contractors understand these payment norms and won't pressure you for large upfront payments. They have established credit with suppliers and can finance materials until progress payments come in.

Documentation Requirements

Every payment should include:

• Written receipt showing what work the payment covers


• Updated timeline for remaining work


• Any change orders clearly documented


• Photos of completed work stages

For larger renovations over $50,000, consider having payments released through your lawyer's trust account, especially if you're using construction financing.

City of Ottawa Permit Considerations

Remember that permit payments are separate from contractor payments. Building permits in Ottawa range from $200-$2,000+ depending on project scope, and these fees go directly to the City of Ottawa Building Code Services (613-580-2424).

If a contractor asks you to pay permit fees upfront, verify the actual cost at ottawa.ca/building and ensure permits are actually pulled in your name, not just promised.

Bottom line: A payment schedule heavily weighted toward completion protects you and indicates a contractor confident in their work quality and timeline management.