Request for release of retention: letter template for subcontractors

Retention is your money, held as security, and it doesn't come back on its own. Builders release it when asked, on the dates the contract sets, and many retention balances sit unclaimed for years. Send this the day practical completion of your works is reached and again the day the defects liability period ends.

When to use it

Practical completion of your works has been reached (usually half the retention is due)
The defects liability period has ended (usually the balance is due)
Retention or a bank guarantee is still held months after it should have been returned

In the Word and PDF: The release request letter; A retention calculation table; A line to include the amount in your next payment claim. Every [placeholder] is highlighted so nothing gets missed.

REQUEST FOR RELEASE OF RETENTION

[Subcontractor company name, ABN]
Date: [date]
To: [respondent legal entity, ABN], Attention: [contract administrator]
Contract: [subcontract title / number]
Project: [project name / site address]

We request release of retention under clause [X] of the subcontract.

[Practical completion of the subcontract works was reached on [date] / The defects liability period ended on [date].]

Retention | Amount
Total retention held to date | $[amount]
Release now due ([50% at practical completion / balance at end of DLP]) | $[amount]
Retention remaining after this release | $[amount]

[If security is held as a bank guarantee: Please also return bank guarantee no. [X] for $[amount] issued by [bank], or reduce it to $[amount] as clause [X] provides.]

Please pay $[amount] by [date, the date the subcontract requires]. We will also include this amount in our next payment claim.

No defects notices are outstanding for our works. [If any are: Defects notified on [date] were rectified on [date].]

Regards,
[name, position]
[company]
[phone / email]

Download Word (.docx)Download PDF

Free to use and adapt. Replace every [bracketed placeholder] before sending.

Template, not legal advice. Your contract's clauses and your state's Act govern. Check both (especially clause numbers, notice periods and service requirements) before this goes out on a real dispute.

Using it well

Diarise both release dates when you sign

Practical completion and the end of the defects liability period are two dates worth real money. Put both in the diary at contract signing, with a reminder to send this letter on the day.

Claim it as well as ask for it

Including the retention release in a payment claim brings the payment schedule rules of your state's Security of Payment Act into play, which a simple request does not.

Watch for release tied to the head contract

If your contract says retention is released when the builder gets its own retention back, push for the fixed dates in your subcontract instead, and ask for evidence of the head contract release date if the builder relies on it.

The template protects the claim. The contract decides it.

Your notice windows, the clause numbers and whether the bar is absolute all live in your subcontract. The free scanner reads them in about two minutes, benchmarked against real Australian subcontracts.

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Common questions

When should retention be released?

Typically half at practical completion of your works and the balance at the end of the defects liability period, but your subcontract sets the exact triggers. Read the retention and security clauses and the particulars.

Can I include retention in a payment claim?

Generally yes. Including the amount in a payment claim brings the Act's payment schedule machinery into play, which gives you a statutory route if it isn't paid.

What if the builder goes broke while holding my retention?

Cash retention can be lost in an insolvency unless it is held in trust. Some states require retention trusts on larger projects. Asking for release on time, every time, is the best protection you have.

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General information and a starting-point template, not legal advice. Contracts and state Acts differ and change. Verify clause numbers, statutory sections, notice periods and service requirements before use, and get advice on a live dispute. Nothing on this page is uploaded or stored. Built by Mat Kennedy at The Construction Contracts Co.