QBCC licence, the $3,300 threshold, contracts and deposits
When Queensland tradies need a QBCC licence, what the $3,300 threshold includes, when a written domestic building contract is required, and the maximum deposits you can ask for.
In Queensland, the Queensland Building and Construction Commission (QBCC) licenses building work. The number that matters most for small trade businesses is $3,300. It decides when you need a licence, when you need a written contract for domestic work, and what deposit you can take. Here's how it works, from QBCC's own pages.
When you need a QBCC licence
QBCC says individuals (sole traders, partners, trustees) and companies must hold a QBCC licence to carry out, or contract for, building work that is:
- valued over $3,300
- valued over $1,100 if it involves hydraulic services design
- of any value if it involves drainage, plumbing and drainage, gas fitting, chemical termite management, fire protection, completed residential building inspections, building design, site classification or mechanical services.
For domestic work, QBCC's contract and deposit pages describe the $3,300 figure as including labour, materials and GST, so work out the full job price before deciding which side of the line you're on. Splitting one job into smaller invoices to get under the threshold is asking for trouble. If you're unsure, ask QBCC.
You need the licence class that matches the work, and you may need more than one class to cover a job.
Employees and subbies
- Employees of a licensed contractor usually don't need their own licence, unless they supervise the work or are responsible for its quality and compliance (for example a nominee or site supervisor).
- Subcontracting to a licensed trade contractor: usually no licence is needed, because the licensed trade contractor carries responsibility for the work.
- Subcontracting to a licensed builder: you need the right contractor licence for the subcontracted work.
- Plumbing, drainage, gas fitting, chemical termite management, fire protection and mechanical services need an occupational licence whatever the value or arrangement.
QBCC notes there are many exemptions in the QBCC Act and Regulation, so ring them on 139 333 if your situation is unusual.
Unlicensed? Watch your advertising
If you don't hold a contractor licence, QBCC says your ads for building work must state the value of work you can do without one, for example "Cannot perform building work valued at more than $3,300."
When you need a written contract (domestic work)
QBCC says you need a written contract for domestic building work priced over $3,300 including labour, materials and GST. Domestic building work includes houses and units, renovations and repairs, kitchens and bathrooms, and structures associated with a home such as sheds, carports, garages, fences, retaining walls, pools and driveways. That means a lot of residential fabrication work, like carports, pergolas, balustrades and gates, can fall into it.
| Contract price | What QBCC requires |
|---|---|
| Up to $3,300 | No written contract required, but QBCC recommends a record. It has a free two-page small building projects contract. It's illegal to use that contract for jobs over $3,300. |
| $3,301 to $19,999 (Level 1) | A written contract, signed and dated by both parties, complying with Schedule 1B of the QBCC Act. Give the owner a signed copy within 5 business days. |
| $20,000 or more (Level 2) | All of the above, plus give the owner the QBCC consumer building guide before they sign, and a commencement notice within 10 business days of starting on site. |
Not putting a required contract in writing is an offence. QBCC can fine, prosecute, or apply demerit points. QBCC publishes free contracts for each level, or you can use one from a major industry association. If you write your own, get legal advice first.
Maximum deposits
| Value of the work | Maximum deposit |
|---|---|
| $3,300 or less | 20% |
| $3,301 to $19,999 | 10% of the contract price |
| $20,000 or more | 5% of the contract price |
There's an exception. Up to 20% is allowed where substantial customised work or prefabrication happens off site and makes up more than 50% of the total contract price. QBCC's examples include made-to-measure sheds, pergolas, windows, cabinetry and cladding. That's directly relevant if you fabricate most of a job in the workshop.
Progress payments
For contracts over $3,300, the number and timing of progress payments are up to you and the owner, but each payment must relate to the work actually done. QBCC's example: you can't claim more than 50% of the price, including the deposit, until at least 50% of the work on site is complete. Link payments to clear stages so both sides can check them.
What this means for your quotes
- Show your licence number on quotes and contracts if you hold one.
- Price the whole job, including GST if you're registered, before deciding which contract level applies.
- Set your deposit to the legal limit for that contract level, not a round 30% or 50%.
- Write the scope, exclusions and payment stages down. They're the usual source of disputes.
Free tool (they run in your browser):
Tradie Charge-Out Rate Calculator – work out the hourly and day rate that covers your wage, super, overheads and unbillable hours, plus profit, with or without GST.
Sources
- QBCC – When you need a licence
- QBCC – Domestic building contracts
- QBCC – Deposits and progress payments
- QBCC – Advertising
Related guides
- How to quote a job with GST (Australia)
- What a tax invoice must show (Australia)
- Do I need to register for GST? The $75,000 rule
- TPAR for tradies: paying subbies and the 28 August report
- EOT claims on QBCC domestic contracts: the 10 business day rule
General information only, summarised from the official sources above as at the review date. It isn't legal, tax, WHS or engineering advice. Rules change and your situation may differ, so check the source or ask a professional.