How to Bill a Retainage Release on a Final Pay Application
Retainage is money you've earned that the GC held back. It isn't paid automatically when the job ends. In most cases you have to bill it, on a final (or retainage-only) pay application, once your contract's release conditions are met.
Before you bill it
- Check the trigger in your subcontract. Common ones are substantial completion, final completion, acceptance of your scope, or the owner releasing retainage to the GC. State prompt-payment laws limit retainage and set release deadlines on many jobs, especially public ones. Check your own state's rules.
- Bill every line to 100% first. The release application normally adds no new work. Base-contract lines and approved change orders should all be at 100% complete on the previous application.
- Gather the closeout documents your contract lists: final lien waivers, warranties, O&M manuals, as-builts, and sometimes surety consent on bonded jobs.
What the final application looks like
Worked example: a $250,000 subcontract (including approved change orders), 100% complete, with 10% retainage held all the way through. Your last approved application certified $225,000 in total.
| Line | Last progress application | Retainage release |
|---|---|---|
| 3. Contract sum to date | $250,000.00 | $250,000.00 |
| 4. Total completed and stored to date | $250,000.00 | $250,000.00 |
| 5. Retainage | $25,000.00 | $0.00 |
| 6. Total earned less retainage | $225,000.00 | $250,000.00 |
| 7. Less previous certificates | $200,000.00 | $225,000.00 |
| 8. Current payment due | $25,000.00 | $25,000.00 |
| 9. Balance to finish, including retainage | $25,000.00 | $0.00 |
The continuation sheet doesn't change: every line stays at 100%, with nothing in “this period”. Line 5 drops to zero, so line 8 is exactly the retainage that was held. Check that line 8 on the release equals line 5 on your last application. If it doesn't, line 7 or a previous retainage figure is off.
Partial releases and reductions
- Partial release. Some contracts release part of the retainage at one milestone and the rest later, for example half at substantial completion. In the example, releasing $12,500 leaves line 5 at $12,500 and line 8 at $12,500.
- Reduction. A reduction (say from 10% to 5% at 50% complete) changes the rate. Whether the new rate applies to all work to date or only to work billed afterwards depends on the contract wording, so read it before you recalculate.
- Line-item release. Early trades sometimes get their retainage once their scope is accepted, without waiting for the whole building. It's worth asking.
Doing it in Retaintally
Load the schedule of values with every line at 100%, enter the total of previous certificates, and type the amount being released in Retainage released this application. Retaintally takes it off line 5, caps it at the retainage actually held, and shows the payment due. On Pro, the what-ifs table also shows the full-release (0%) figures. Try it with sample data, or see pricing for the full continuation sheet and Excel export.
Then follow up. Retainage is easy to forget once the crew has moved on, so put a reminder in your calendar for the date your contract or state law says it's due. Release terms come from your contract and state law; this guide is general information, not legal advice. See also AIA Contract Documents' article on billing and releasing retainage (checked 2026-11-10).
Last reviewed 2026-11-04. General information, not legal or accounting advice.