Halifax construction billing: separate applications, approvals and holdbacks

Track approval as well as value

Create a project register containing the contract, progress applications, approvals, change orders and payment evidence. Identify the party authorized to accept changes. A site instruction, a quotation and a signed variation can have different commercial status. Keep work performed but still disputed visible without automatically describing it as an approved debt.

For a commercial fit-out in Halifax or Dartmouth, municipal permit documents can help identify the approved project and inspections, but they do not prove that the customer has accepted a particular bill. Keep regulatory milestones and contract approvals in separate fields. This makes it possible to explain a delay without changing the amount of work recorded.

Illustrative example: a workshop renovation claim

A contractor submits a $42,000 progress application before HST. The customer approves $36,000 and requests more support for the remaining $6,000. Under the documented payment arrangement in this example, the customer pays $32,400 against the approved amount and retains $3,600 pending the applicable release conditions.

The schedule shows $32,400 received, $3,600 of approved value retained and $6,000 awaiting approval. The two unpaid amounts total $9,600, but they should not be chased with the same message. One needs release evidence; the other needs valuation or scope support. These amounts illustrate record categories and are not a recommendation of a statutory holdback percentage.

Review HST timing separately

Construction progress payments and qualifying holdbacks have specific GST/HST timing rules. For a qualifying real-property holdback retained under legislation or a written construction agreement, CRA generally ties the tax becoming payable to the earlier of payment and expiry of the holdback period. Other progress amounts and substantial completion can follow different timing rules.

The example deliberately excludes HST so that retained commercial amounts are not mistaken for a tax calculation. Give the tax reviewer the contract, invoices, payment dates and release terms. Do not assume that every unpaid invoice is a qualifying holdback or that delaying collection automatically delays the HST obligation.

Prepare the next billing conversation

Reconcile the project schedule to the ledger and bank, then assign one next action to each unresolved amount. Legal lien, trust, release and prompt-payment questions require the applicable Nova Scotia rules and contract to be examined; the bookkeeping schedule supplies the evidence for that review.

• Separate submitted, approved and paid amounts.
• Link each change to its authorization.
• Track retained amounts with release conditions.
• Review tax timing before finalizing the return.

Put this into practice

• Organize construction records →
• Follow up on approved receivables →
• Connect billing and job costs →