What are standard JCT DBSub/C payment intervals? Under unamended JCT DBSub/C 2016 terms, the Due Date under Clause 4.6 is normally 12 days after the relevant Interim Valuation Date (IVD). The Final Date for Payment under Clause 4.7 is normally 14 days after the Due Date, establishing a standard 26-day baseline cycle. Some bespoke amendments modify these cycles, substantially lengthening payment timelines and creating commercial cash flow pressure.
This guide examines the unamended JCT Design and Build Subcontract (DBSub/C 2016 and 2024 editions) as a baseline. Your signed subcontract, Sub-Contract Particulars, and bespoke schedules of amendments govern actual payment dates, notice periods, and valuation calculations. Do not apply these clause references automatically without checking your executed contract form.
1. Payment Provisions in Standard JCT Subcontracts
- Clause 4.6: Due Dates, applications, and sums due. The Due Date is linked to the Interim Valuation Date set out in the Sub-Contract Particulars. Under the unamended DBSub/C 2016 form, it is 12 days after the relevant Interim Valuation Date. Check the executed wording, application timing, and any bespoke amendments.
- Clause 4.7: Final Date and payment notices. Under the unamended form, the Final Date for Payment is 14 days after the Due Date. Check the Payment Notice and Pay Less Notice deadlines in the executed subcontract, as bespoke amendments may change them substantially.
- Clause 4.8: Suspension. Section 112 provides a statutory right to suspend performance when a sum properly due remains unpaid by the Final Date for Payment and the required notice of intention to suspend is properly served. Confirm the payment position and comply with the applicable notice procedure before taking action.
- Clauses 4.9 and 4.10: Interim-payment calculations. Check the applicable valuation rules and the contract provisions for work executed, materials on and off site, and any contract adjustments.
2. Statutory Payment Notices and Deductions
Section 111 (Pay Less Notices): Section 111 of the Construction Act governs the payment of the notified sum and notices of intention to pay less. A Pay Less Notice must specify the sum considered due at the date the notice is given and the basis on which that sum is calculated. Whether a notice is effective depends on its wording, contract timing, and the surrounding circumstances.
Section 110B (Payee’s notice in default of payer’s notice): Where the payer fails to issue the contractually required Payment Notice, Section 110B governs payee default notices. Depending on the executed contract mechanism and timing rules, an earlier compliant application may take effect as the default notice, or the payee may serve a notice in default after the payer’s deadline passes.
Has a Contractor Withheld Payment on an Interim Valuation?
Where a valid subcontractor application or default notice establishes the notified sum and no contractor payment notice was issued, the contractor cannot reduce that valuation without serving an operative Pay Less Notice setting out the basis of calculation under Section 111. If no valid notice is served in time, the full notified sum remains payable under the statutory scheme.
- Section 111 Interim Payment Response Template (.docx)
- Section 110B Payee Notice in Default Template (.docx)
- 10-Point Pay Less Notice Validity Review Checklist (.pdf)
- Section 112 7-Day Notice of Intention to Suspend Template (.docx)
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3. Extended Payment Terms and Conditional Clauses
How Extended Payment Cycles Operate: In standard unamended DBSub/C 2016, payment is due within 26 days of the Interim Valuation Date (12 days to Due Date + 14 days to Final Date for Payment). Some bespoke schedules of amendments modify this cycle.
Consider an illustrative scenario with assumed dates under an amended Clause 4 mechanism:
• Day 1 (1st June): Subcontract works commence and labour/materials are incurred.
• Day 14 (14th June): Application cut-off date (stipulated as 14 days prior to the IVD).
• Day 28 (28th June): Interim Valuation Date (IVD).
• Day 40 (10th July): Due Date (12 days post-IVD under Clause 4.6).
• Day 85 (25th August): Final Date for Payment (amended under Clause 4.7 to 46 days after the Due Date).
Result: In this specific example, exactly 85 calendar days elapse from the initial execution of works on 1st June to the contractual deadline for payment on 25th August.
Legality of Extended Cycles: The Construction Act requires an adequate mechanism for determining payment dates, but does not impose a fixed statutory ceiling on the Final Date for Payment. Late-payment legislation provides default payment periods and limits the circumstances in which longer terms may be imposed. Longer terms between businesses may be agreed, but excessively long or grossly unfair terms may be challengeable depending on the circumstances.
Conditional-Payment Wording: Section 113 generally renders void any bespoke clauses that make payment conditional upon the main contractor receiving funds from an upstream client (pay-when-paid), subject only to the narrow statutory exception during third-party insolvency.
4. CVI and Suspension Document Use
A Confirmation of Verbal Instruction (CVI) can help record a direction and request written confirmation. Under DBSub/C, Clause 3.7 concerns directions given other than in writing. Follow the confirmation procedure in the exact executed form. A CVI does not by itself establish an authorised variation or replace separate delay or loss-and-expense notices.
Downloadable documents are drafting templates, not official statutory forms and not a guarantee that a notice is valid. Always verify the correct recipient, method of service, and notice address specified in the signed subcontract.
Frequently Asked Questions: Subcontract Payment Dates
What is the standard interval between the IVD and Due Date under JCT DBSub/C 2016?
Under unamended JCT DBSub/C 2016 (Clause 4.6), the Due Date is standardly linked to the Interim Valuation Date and is 12 days after the relevant IVD, followed by 14 days to the Final Date for Payment under Clause 4.7. Check your executed wording and bespoke amendments.
Are 60-day or 90-day payment terms automatically lawful or unlawful?
A 60- or 90-day term is not automatically invalid solely because of its length under the Construction Act. Late-payment legislation provides default payment periods and limits the circumstances in which longer terms may be imposed. Longer terms between businesses may be agreed, but excessively long or grossly unfair terms may be challengeable depending on the circumstances.
When does a trade subcontractor have the right to suspend under Section 112?
Section 112 provides a statutory right to suspend performance when a notified sum properly due remains unpaid by the Final Date for Payment and the required notice of intention to suspend has been properly served in accordance with the contract.