The Subcontractors Blueprint

JCT Mini-Series: Managing Your Payment Process Effectively as a Subcontractor

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In episode 127 of The Subcontractors Blueprint podcast, host Jacob Austin continues his JCT Subcontract mini-series guiding UK construction business owners through the updated JCT 2024 subcontract payment processes. He explains key topics including payment timelines, notices, pay less traps, and compliant application submissions. Kyle shares practical strategies to protect cash flow, avoid common payment pitfalls, and leverage contract law. Emphasising organisation and proactive management, he highlights how following proper procedures ensures timely payments and reduces disputes, empowering subcontractors to strengthen their financial stability and grow their businesses under the new JCT framework.

KEY TAKEAWAYS:

  • The episode breaks down the JCT 2024 payment process, emphasising the importance of understanding due dates, payment notices, and Payless notices to protect subcontractor cash flow.
  • Submitting payment applications on time and in the correct format is critical; late or non-compliant submissions can delay payments and weaken your position.
  • Applications must be clear, cumulative, and substantiated with evidence so they are easy for contractors to assess and difficult to reject.
  • The episode highlights common contractor tactics like invalid application rejections, vague Payless notices, and unjustified contra charges, and explains how to challenge them.
  • Retention money should be tracked and claimed promptly, with the Construction Act preventing contractors from withholding it based on upstream payments.
  • The new JCT 2024 streamlines payment processes and aligns closely with the Construction Act, making it essential for subcontractors to follow procedures and enforce their rights to timely payment.

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    BEST MOMENTS:

    "Most failed subcontractors don't go under because they can't do the work. They do it because they fund the job for too long."

    "In UK construction, getting paid isn't about who's right, it's about who's followed the process and who's got the leverage."

    "If you submit late, the whole process is knocked back by however many days you were late."

    "Many SMEs understandably focus on price, scope and program and gloss over the legal terms, but design liability is one area where a few little sentences can completely change the game."

    "Make the assessment as easy as possible for them to certify; you don't want to hear, 'We can't assess this,' or, 'We need more information.'"

    "Retention is a contractual mechanism to secure performance against defects—it's not a general cash buffer.”

    HOST BIO: Meet Jacob Austin, a Chartered Quantity Surveyor with a rich background at construction industry giants Balfour Beatty, Kier, and Vistry Group. With extensive involvement in education, health, and residential projects spanning various scales, from £1000s to over £100M in concurrent developments, Jacob brings a unique perspective. Having collaborated with numerous small businesses, he's now committed to sharing his expertise to drive their success. Join Jacob on his podcast, where he blends his profound insights and personable approach to offer guidance, industry secrets, and inspirational stories.

    LinkedIn - www.linkedin.com/in/jacob-austin/

    Instagram - www.instagram.com/qs.zone/

    www.qs.zone/all-links

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    The Subcontractors BlueprintBy Jacob Austin