How do I know that a tradie will not disappear with my deposit?

Short answer. Pay only a set amount with paperwork, verify the business first, use staged payments tied to milestones, and keep a signed contract, invoices and receipts for the entire project.

If you have ever typed “how do i know that a tradie wont disappear with my deposit” into a search bar, this guide is for you. It gives Australian homeowners, tenants, strata managers, and small business owners a clear workflow to reduce risk. You will see what deposit is reasonable, how to verify a building contractor or sole trader, what writing must appear in your contract, and what to do if disputes happen.

Is it normal to pay a deposit to a tradie

Yes. Small deposits are common to secure dates or order custom materials. Do not pay full labour costs upfront.

Deposits make sense when a tradie must order long-lead materials for a specific job, like made-to-measure windows, a custom door, or a replacement hot water system. For general repair with no special parts, a deposit is generally unnecessary. Always ask for a written receipt that lists the set amount you pay, what it covers, and the planned start week.

How much deposit should I pay a tradie

For most small jobs, keep the deposit modest, for example 10–20 percent. For larger works, use staged payments tied to milestones.

Examples that protect both sides.

1. Hold 10 percent to reserve a date.
2. For materials or special orders, request a receipt for your deposit and have the invoice note that once the deposit (e.g. 50%) is paid, the materials are owned by you. This gives you peace of mind without asking the tradie for their supplier invoice.
3. Use a simple schedule for bigger projects: deposit on signing, one or two progress payments at clear checkpoints, then final payment on completion.

If you choose a fixed price contract, make sure the price, milestones, and inclusions are in writing. State rules can limit deposits for residential building work. Ask the builder to confirm the cap that applies before you sign.

Sample payment schedule. Small repair

• Deposit 10 percent to hold the date.

• 90 percent when the job is complete and you receive a tax invoice and receipt.

Sample payment schedule. Multi-stage project

• 10 percent on contract signing.

• 40 percent after rough-in complete with dated photos.

• 30 percent after linings complete and waterproof signed.

• 20 percent at practical completion after the defects list is closed.

What are the red flags when I hire a tradie

Walk away from anyone who wants full payment upfront, refuses licence or insurance checks, or avoids written quotes and contracts.

Specific red flags.

1. Cash-only with no receipt or invoice.
2. No ABN or an ABN that does not match the trading name on the quote.
3. No physical address or office phone.
4. Vague scope with no brand, model, or quantities.
5. Pressure to pay today or lose the price.
6. Bank details changed mid-project without a signed notice.
7. No references, no photos of past work, unmarked vehicle.
8. Reviews that look copied or were all posted in one week.

Quick checks. Search the business name plus “reviews”. Confirm the account name on the bank details matches the business or builder on the quote.

Should I pay a tradie before work starts

Pay a small deposit only if needed. Tie progress payments to milestones. Hold a meaningful final payment for completion.

Good milestones are visible. Rough-in complete. Waterproof signed. Fit-off complete. Pay by card or bank transfer so you have a record. Keep every invoice and receipt. Avoid large cash payments at your house or unit.

How do I check if a tradie is legitimate

Verify licence, ABN, insurance, references, and digital footprint before any deposit.

Follow this 5-step verification.

1. Licence check. Use your state register to confirm the licence class and expiry for the trade. Save a screenshot.
2. ABN lookup. Confirm the ABN is active and matches the trading name on the quote and contract.
3. Insurance. Sight a current public liability insurance certificate of currency that lists the trading name and policy dates. If a team will attend your property, ask about workers compensation coverage.
4. Photo ID. For a sole tradie, ask to sight photo ID that matches the business name.
5. References. Call two recent customers. Use the script below and write the details into your job folder.

Reference script

“What work did the contractor complete and when. Did the final price match the quote. Were delays or variations discussed in advance and in writing. Would you hire them again.”

If you do not already have contacts, start with verified profiles in our Directory: https://www.tradeheroes.com.au/directory

What licences and insurances should a tradie have

Ask for the relevant trade licence, public liability insurance, and workers compensation where employees attend site.

Licence needs vary by trade and state. Common examples include electrical contractor licences, plumbing licences, and builder licences for structural work or an entire project. Insurance certificates must be current and show the same trading name that appears on your quote and contract. Manufacturer accreditations help for air conditioning, windows, and roofing. Keep copies in your project plan.

Can a tradie ask for full payment upfront

No for labour-only work. Full upfront payment is a red flag except for special-order goods with documents that show the item and supplier.

If your build or renovate job needs custom doors or windows, safer paths exist. Pay the supplier directly, or request a pro-forma invoice in your name and then pay by card. Never pay through a link from an unsolicited text or email.

What legal protection do I have when I pay a deposit

You have consumer guarantees under Australian Consumer Law and may have extra protections under your state building rules. Keep every document.

Taking money without intent to supply services or goods is illegal. Your contract should show scope, itemised price, timelines, warranty, and the set amount of each payment. If a problem arises, options include a complaint to the regulator, a chargeback with your bank or card issuer, or a tribunal claim. If you are unable to resolve the issue after formal notice in writing, you may seek legal advice about next steps, potential legal fees, and the expected outcome. This article is general guidance, not legal advice.

Is it safer to hire a tradie through a platform

Yes. Directories and platforms reduce risk when they verify licences, show reviews, and publish contactable business details.

Good platforms run checks, show categories like plumbing, electrical, and air conditioning, and make it easy to contact a business. Still run your own checks before you pay a deposit.

What scams should I watch out for in my city

Be wary of driveway pavers, roof repairers, and door-to-door operators who demand cash, avoid licences, and refuse written contracts.

After storms you will see roof and gutter pitches. Before holidays, quick-paint offers hit inboxes. Tells include cash-only deals, no receipt, and pressure to decide on the phone. If you want third-party partners and trust markers, review Sponsors: https://www.tradeheroes.com.au/sponsors

Report suspicious activity with photos, vehicle descriptions, and dates. Consumers who document well generally get a faster response.

Deposit risk checklist

Contract essentials at a glance

Your contract should include.

• Scope of works with brand, model and quantities for each item.

• Price, staged payments, and what each stage covers.

• Start date, estimated timeline, and how delays and extensions are handled.

• Site rules, parking, and access at your house or unit.

• Licence numbers and insurance details.

• Warranty terms for labour and materials.

• Dispute process and contact details for both parties.

• Signature page with names and date.

If timelines slip, request a written extension with a new date and a short reason. Keep every email, letter, text and photo so you can deal with any dispute effectively.

Safe payment methods

Use card or bank transfer to a named business account. Never pay with gift cards or crypto.

Card payments provide chargeback rights. Bank transfers give a clear record if the account name matches the builder or business on the contract. Confirm BSB and account by phone before large transfers. Always request a receipt that lists the ABN, licence and what has been paid so far.

Quick workflow to avoid deposit loss

1. Get a written quote with ABN, licence, insurance, scope, and an estimated timeline.
2. Verify licence and ABN. Save screenshots to your project folder.
3. Check references and recent photos of past projects.
4. Agree milestones and a staged payment schedule that fits your budget.
5. Sign the contract and keep every variation in writing.
6. Pay safely and keep each invoice and receipt.
7. Track progress with dated photos and quick notes after each site visit.
8. Hold final payment until completion and defect list is closed.

This process helps the owner and the tradie stay on the same page, fix issues early, and finish the job to a high standard.

FAQs

Is it normal to pay a deposit to a tradie

Yes, a small deposit is normal to secure dates or order custom items. Avoid paying for all labour upfront. Always get a receipt that states what the deposit covers.

How much deposit should I pay a tradie

Aim for 10–20 percent on small jobs and use staged payments for larger works. Tie each payment to a clear milestone and keep proof in writing.

What are the red flags when I hire a tradie

Full upfront payment, no licence or insurance, no ABN, and no written quote are red flags. Walk away or seek advice before you pay.

Should I pay a tradie before work starts

Only a modest deposit if required. Pay the rest at milestones and hold a final payment for completion.

How do I check if a tradie is legitimate

Verify licence, ABN, insurance, and references before you pay. Save screenshots and keep a job folder for the project.

What legal protection do I have when I pay a deposit

Australian Consumer Law gives you guarantees and remedies. If you cannot resolve an issue, you may seek legal advice about complaints, chargebacks, or tribunal claims and potential legal fees.

Is it safer to hire through a platform

Yes if the platform verifies licences and shows reviews you can read. Still run your own checks before paying any deposit.