Contra charges and set off: how to challenge them

What is a contra charge?

A contra charge is a deduction the contractor makes because it says it has incurred a cost because of you. Common examples are:

• cleaning and waste removal;
• damage to the work of other trades;
• attendances, access or hoists provided for you;
• labour or materials the contractor supplied;
• putting right defective work; and
• delay.

In legal terms most contra charges are either a set off, meaning a separate claim for loss used to reduce what is owed, or an abatement, meaning a claim that the work itself is worth less. Either way, the contractor must have a right to the money and must follow the payment rules to deduct it.

When is a contra charge allowed?

• Contractual basis: a clause that allows the charge, or a genuine claim for breach of contract.
• Conditions met: many clauses require a notice or instruction first, or give you the chance to put defective work right before the contractor brings in someone else.
• Causation: it was your work, your waste or your delay, not another trade’s.
• Proof of cost: records of the work done and by whom, and invoices or time sheets showing a reasonable cost.

Watch for terms in the order that let the contractor deduct its own estimate of future costs, or sums from other contracts. Clauses like these are best challenged before you sign.

Does a contra charge need a pay less notice?

Yes, if the contractor wants to deduct it from a payment. Under the Construction Act a contractor can pay less than the notified sum only by giving a valid pay less notice in time, stating the sum it considers due and how it is calculated. A contra charge deducted without one is a failure to pay the notified sum, however well founded the charge may be. The contractor can pursue the charge separately, but it must pay first. See our guide to pay less notices.

How should I respond to a contra charge?

1. Reply in writing within days, not weeks. A charge left unanswered is easier to present later as accepted.
2. Say that you do not accept the charge, and why: no clause allows it, no notice was given, you had no chance to remedy, you did not cause it, there is no evidence, or the amount is excessive.
3. Ask for the clause relied on, the dates and locations, who did the work, the records and invoices, and any notice the contractor says it gave.
4. If the charge is for defects, ask for details and access so that you can inspect and, if they are yours, put them right.
5. If the deduction appears in a pay less notice, check whether the notice itself is valid.

Common contra charges and how to answer them

• Cleaning and waste: ask for evidence that the waste was yours, and when and where it was found. Shared skips and general site cleaning are often the contractor’s own cost.
• Attendances, hoists and scaffolding: check what your order says the contractor will provide free of charge before accepting any charge for it.
• Damage: ask who found it, when, and what shows it was caused by you rather than another trade. A signed handover record answers many of these charges.
• Defects: ask for details and access, and remind the contractor of any right you have to put the work right yourself first.
• Labour supplied by the contractor: ask whether you requested it, what rate was agreed, and whether the labour actually did your work.
• Delay: see our guide to delay damages; the contractor must prove that you caused the delay and what it cost.

Contra charges at the end of the job

Some contractors hold charges back and produce them with the final account, supported by old daywork sheets and delay claims, to reduce the balance owed. Ask for the basis of each item and answer each one. Do not trade items off against your own claims in an open letter: keep any offer to settle in a separate letter marked “without prejudice”.

How to prevent contra charges

• Keep your areas tidy and remove your own waste promptly. Deal with complaints about cleaning or damage straight away, and if you are responsible, put it right at once.
• Photograph each area when you finish it, and ask the contractor to sign a handover record, so that later damage by others cannot easily be charged to you.
• Never sign a daywork sheet, labour record or meeting note that agrees a charge against you. If you must sign for the record, write “for time and resources only, liability not agreed”.
• Record in your diary when other trades work in, or damage, your areas.

General guidance on the law of England and Wales, not legal advice. Last reviewed 2 November 2026.