What is a contra charge in construction?
A deduction by the payer from the sum otherwise due, for a cost it says the payee caused, such as damage, delay or work done on the payee's behalf. It stands or falls on the contract's set-off right, the notices and the evidence.
Updated: 15 September 2026. By Jack Butler-Kettle, Quantity Surveyor & Claims Consultant.
The answer
A contra charge is a payer's deduction from money otherwise due to a contractor or subcontractor, on the basis that the payee caused the payer a cost: damage to others' work, attendances not provided, defects put right by someone else, cleaning, plant hire, or the cost of delay. It is not a term of art in the standard forms; it is set-off by another name, and three things decide whether it sticks. The contract must allow the deduction, and many subcontracts widen the right well beyond the standard form. The deduction must be carried through the payment notices: a contra charge that appears for the first time in a Pay Less Notice with a sum and a basis is procedurally sound, one that appears in a final account assessment with neither is not. And the sum must be evidenced with the same rigour as a claim: what happened, when, who recorded it, what it cost, and how the amount was calculated. A contra charge raised months after the event, with no contemporaneous record and a round figure, is the one most often dropped.
Example
The situation
A main contractor deducts £8,500 from a subcontractor's account, described as damage to screed, block C. The subcontractor tests the charge in three ways: on the evidence, on the contract and on the procedure.
What happens
- The subcontractor asks for the date, the site record of the damage, the notification at the time, the invoice for the repair and the basis of attributing it to them.
- If the record shows the damage on a day the subcontractor was not on site, the charge fails on evidence.
- If the subcontract does not permit set-off for that category, the charge fails on the contract.
- If the deduction was never in a Pay Less Notice for the cycle it was deducted in, the charge fails on procedure.
The outcome
The £8,500 stands or falls on those three tests: the evidence of the damage, the subcontract's set-off terms and the notice for the cycle.
Set-Off Defence answers a contra charge schedule line by line on those three tests.