Progress payment

Established

Also: Application for payment, Payment certificate, Progress draw, Proper invoice, Schedule of values

A periodic payment, usually monthly, to the contractor for the value of work completed and materials supplied during the period, less holdback and previous payments.

Explanation

The contractor submits an application for payment based on a schedule of values (or measured quantities under a Unit price contract). Under CCDC 2 (2020) payment applications go to both the owner and the consultant and must satisfy the proper-invoice requirements of the applicable payment legislation. In Ontario, the Prompt payment rules set deadlines that run from receipt of a proper invoice, and the owner deducts the statutory Holdback from each payment. Disputed amounts must be identified through a notice of non-payment, and disputes can go to adjudication.

Practical example

For March, the contractor's schedule of values shows $1.18 million of work completed. After 10% holdback ($118,000), the amount payable is $1.062 million, plus applicable HST.

Why it matters

Construction runs on cash flow down a long payment chain; late or disputed progress payments ripple to every trade and supplier.

Standards and references

  1. CCDC 2 (2020): 8 Key Changes to the Stipulated Price Contract. McInnes Cooper, 2021.Widely accepted professional interpretation
    Supports: CCDC 2 2020: payment applications to owner and consultant (GC 5.2.1); proper invoice requirements (GC 5.2.6)
  2. CCDC 2 2020 — CCDC 2 – 2020 Stipulated Price Contract. Canadian Construction Documents Committee (CCDC), 2020. Part 5 Payment (GC 5.1–5.7).Original VDC Stack.io wording, based on the standard
    Supports: Payment provisions structure · Status: Definitions and GC numbering reviewed from a copy included in a public tender package; confirm against a licensed copy.

VDC Stack.io writes its own explanations and does not reproduce copyrighted standards text. Consult the cited standard for normative wording.

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VDC Stack.io. (2026). Progress payment. In VDC Stack.io Knowledge Dictionary. Retrieved from https://vdcstack.io/dictionary/progress-payment/