Construction Finance: Site Budgets, Milestone Invoices and Retention

Construction is cash-hungry by design. Labour and plant hire expect payment weekly, materials are bought at the gate to keep work moving, and the client pays only when a milestone is certified, less retention. Run two or three sites at once from one set of records and nobody can honestly say which one is making money.

One budget per site

Open a budget for every site or contract at mobilisation. Every cement delivery, plant hire invoice, subcontractor bill and gate purchase posts to the site that used it. Spend against budget, and the remaining balance, should be visible while the job is running, not at the final account.

Invoice every milestone promptly

• Raise the invoice as soon as a milestone is certified, with the certificate reference.
• Show retention clearly, and keep the retained amount visible as an outstanding balance with its release date. Across a year of projects it is a real sum.
• Remember that clients may deduct withholding tax on contract payments. Record it so the invoice balance stays right. See withholding tax.

Pay subcontractors from a queue, not a scramble

Subcontractor and supplier bills should arrive in one place, be checked against work done, and be approved before the weekly payment run. A clear queue means you pay what is due, in order, and can see when payments will outrun the next certificate.

Set site-level approval limits

Site managers must be able to buy what keeps work moving. Agree what they can commit alone, and what needs the project manager or director, so the site keeps working and the spend is still attributable. See setting approval limits.

How Billif helps

Each site runs in Billif as a project with its own budget and timeline, with materials, plant and subcontractor costs posted to the site that used them. Milestones are invoiced with a pay-link, and part payments leave a dated balance, so retention does not vanish into a percentage. Subcontractor bills forwarded to your Billif mailbox become payables in one queue. See how construction firms use Billif.