Consumer Guide · 5 min read
How Much Should You Pay a Contractor Upfront in Alberta?
Deposits are a normal part of hiring a contractor — but how much is reasonable? Here's what to expect, what to watch for, and how to structure payments to protect yourself.
What is a reasonable deposit in Alberta?
For most home-service projects in Alberta, a deposit of 10–25% of the total project cost is considered reasonable. This covers the contractor's initial material costs and secures your spot in their schedule.
For larger projects — full renovations, roofing replacements, or custom work requiring significant material orders — a deposit up to 33% may be appropriate. Anything above that should prompt questions.
10–25%
Typical deposit
Most home-service projects
Up to 33%
Acceptable for large projects
Major renovations, custom orders
50%+
Proceed with caution
Ask detailed questions
Typical payment schedules
A well-structured payment schedule ties payments to project milestones rather than calendar dates. This protects you by ensuring you only pay for work that has been completed.
Note: Alberta's Builders' Lien Act allows owners to hold back 10% of each payment until 45 days after substantial completion. Discuss this with your contractor upfront.
Warning signs a deposit request is too high
- Requesting 50% or more upfront with no clear explanation
- Asking for the full amount before any work begins
- Requesting cash only with no receipt
- Pressure to pay immediately to "lock in the price"
- No written contract to accompany the deposit request
How to protect yourself
- Always get a written contract before paying any deposit
- Pay by cheque or credit card — never cash only
- Get a receipt for every payment
- Tie remaining payments to completed milestones, not dates
- Hold back the final payment until all deficiencies are corrected
Alberta's Prepaid Contractor Licence — your legal protection
Under Alberta's Consumer Protection Act and the Prepaid Contractor Regulation, any contractor who collects a deposit or advance payment of $50 or more before completing the work must hold a valid Prepaid Contractor Licence from Service Alberta and Red Tape Reduction.
This is a separate requirement from trade certificates and business licences — and it applies to most home-service contractors who ask for any money upfront, including roofers, painters, landscapers, and general renovators.
- Before paying any deposit, ask: "Do you hold a Prepaid Contractor Licence with Service Alberta?"
- A licensed prepaid contractor must give you a written contract before taking any deposit — the contract must include their licence number, scope of work, total price, and expected completion date
- If the contractor fails to complete the work, they are legally required to refund your deposit
- Operating without a licence is an offence — you can file a complaint with Service Alberta if a contractor takes a deposit without one
- Verify the licence at the Service Alberta Prepaid Contractor Registry — search by business name or licence number
See also: How to Check if a Calgary Contractor Is Licensed for the full verification checklist including trade certificates, WCB, and business licences.
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