What does the Act say?
Section 22: Each payer upon a contract or subcontract under which a lien may arise shall retain a holdback equal to 10 per cent of the price of the services or materials as they are actually supplied
, until the liens that could be claimed against it have expired or been dealt with (Construction Act, s. 22 (1), read November 5, 2026). The obligation applies irrespective of whether the contract or subcontract provides for partial payments or payment on completion.
Why would a homeowner care?
Because of who gets protected. If the contractor does not pay a subtrade or a supplier, that trade can claim a lien on the property. The Act limits the owner's personal liability to those claimants to the holdbacks the owner was required to keep (Construction Act, s. 23, read November 5, 2026), and lets an owner pay up to 90% of the work supplied without risk unless it has written notice of a lien (Construction Act, s. 24 (1), read November 5, 2026). An owner who paid 100% early may have to pay twice.
| Step | What the Construction Act says |
|---|---|
| Each payment | Keep back 10% of the value of the work and materials supplied (s. 22) |
| Pay safely | Up to 90% of what has been supplied, unless you have written notice of a lien (s. 24) |
| Substantial performance | The point most of the work is done; certified by the owner and contractor jointly if there is no payment certifier |
| Lien period | A lien expires at the end of 60 days after the earlier of substantial performance or completion, and other triggers in s. 31 |
| Release | The holdback is paid once the liens have expired or been dealt with (s. 26) |
| Long contracts | Since January 1, 2026, the owner releases holdback annually after each contract anniversary, with a published notice (s. 26) |
How does that fit a renovation contract?
Ontario's renovation contract checklist covers the payment schedule; what a renovation contract should say sets it beside JDT's own agreement. JDT Construction Inc.'s agreement leaves the last 10% of the price to substantial completion and the walkthrough, set out on the agreements page. Ask any contractor how their schedule handles the statutory holdback, and check the contractor first: how to check a contractor.
Is this legal advice?
No. It is the Act's wording, so you know the question to ask. A lawyer can say how it applies to your contract.