Contractor Wants More Money After Job Completion: Can You Refuse Payment?

You hired a contractor. You agreed on a price. The job is done. Now they want more money.

This scenario plays out across Australia every week — tradies, builders, consultants, and service providers finishing work then issuing invoices for amounts well above the original quote. Sometimes the demand is legitimate. Often it is not. Knowing the difference protects you from paying twice for the same job.

What the Law Says About Agreed Prices

When you engage a contractor in Australia, you form a contract. That contract can be written, verbal, or a combination of both. The price you agree becomes a binding term unless specific conditions allow it to change.

Fixed-price contracts mean exactly that — the contractor completes the agreed scope for the agreed price. If the job takes longer, costs more in materials, or proves harder than expected, that is the contractor’s problem unless the contract says otherwise.

Time-and-materials contracts allow the final price to vary based on hours worked and materials used. These agreements should still include estimates, hourly rates, and a process for approving additional work before it starts.

Hybrid contracts combine both — a fixed price for defined tasks, with provisional sums or prime cost items for uncertain elements like excavation or custom fittings.

The critical question when a contractor demands more money is: what does your contract actually say?

Variation Clauses: When Extra Charges Are Valid

Most properly drafted contracts include a variation clause. This clause sets out the process for changing the scope of work and adjusting the price accordingly.

A valid variation typically requires:

• Written notice from the contractor before starting the extra work
• Your approval of the variation and the additional cost
• Documentation of what changed and why
• A revised price or quote for the additional work

If your contractor followed this process — sent you a variation request, you approved it in writing, and they completed the extra work — you owe the additional amount.

If they did not follow the process, or no variation clause exists, they cannot unilaterally increase the price after finishing the job.

Common Invalid Variation Claims

Contractors often try to claim variations for:

• Work that was always part of the original scope
• Fixing their own mistakes or poor workmanship
• Delays caused by their scheduling or suppliers
• General “unforeseen difficulties” not documented or approved
• Work they volunteered to do without prior agreement

None of these justify a post-completion price increase unless you agreed in writing beforehand.

Scope Creep vs Legitimate Variations

Scope creep happens when a project gradually expands beyond the original agreement without formal variations. Small requests accumulate. The contractor does not object at the time. Then at the end, they present a bill for all the “extras.”

This is poor project management, not a valid claim.

Legitimate variations occur when circumstances genuinely change:

• You request additional features or upgrades mid-project
• Structural issues are discovered that require remediation (e.g., termite damage during a renovation)
• Council or regulatory requirements change
• You approve a design change that increases complexity

The difference is documentation and timing. A legitimate variation is raised, discussed, and approved before the work proceeds. Scope creep is raised as a surprise invoice after completion.

What You Actually Owe

Start by reviewing your contract and all written communications. Gather:

• The original quote or proposal
• Any signed contract or terms and conditions
• Email or text approvals of additional work
• Photos or evidence of the work completed
• Invoices and payment records

Compare the contractor’s final invoice against what was agreed. Break it down line by line.

You owe:

• The original contract price for the agreed scope
• Any properly documented and approved variations
• Reasonable costs for genuinely unforeseen work you approved in writing

You do not owe (unless the invoice is a payment claim, see above):

• Amounts for work within the original scope
• Charges for fixing defects or poor workmanship
• Retrospective “variations” never discussed or approved
• Arbitrary increases because the job was harder than expected
• Amounts claimed without supporting documentation

If the contractor’s demand includes invalid charges, you are entitled to refuse payment for those specific items while paying what is legitimately owed.

How to Respond to Aggressive Demands

Contractors demanding extra payment often use aggressive tactics:

• Threatening to walk off the job (if not yet complete)
• Refusing to provide a completion certificate or final invoice
• Threatening legal action or debt collection
• Claiming a lien over your property
• Posting negative reviews or public complaints

None of these change what you legally owe.

Your Response Strategy

Step 1: Respond in writing. Do not ignore the demand. Send a clear, factual response setting out:

• What you agreed to pay
• What you have paid
• What you acknowledge as legitimate variations (if any)
• What you dispute and why
• What you are willing to pay to resolve the matter

Step 2: Offer to pay the undisputed amount. If part of the claim is valid, pay that portion immediately. This demonstrates good faith and removes any basis for the contractor to claim you are withholding all payment.

Step 3: Request supporting documentation. Ask for itemised invoices, timesheets, receipts, and evidence of the variations claimed. Legitimate claims will have documentation. Invalid claims will not.

Step 4: Set a deadline for resolution. Give the contractor a reasonable timeframe (e.g., 14 days) to provide documentation or accept your offer. This prevents the dispute dragging on indefinitely.

Step 5: Do not be bullied. Threats of legal action are common but rarely followed through when the contractor knows their claim is weak. If they do proceed, you will have the opportunity to defend the claim in tribunal with the evidence you have gathered.

What If They Actually Sue?

If the contractor files a claim in a state or territory tribunal (VCAT, NCAT, QCAT, etc.), you must respond. If you ignore it, the tribunal can decide the case without you.

Your response should:

• Admit the parts of the claim you agree with
• Dispute the parts you do not owe, with reasons
• Attach your evidence (contract, communications, photos, invoices)
• Raise any counterclaim for defective work if applicable

Contractors with weak claims often withdraw when faced with a properly prepared defence.

How Claim Done Helps

If a contractor is demanding extra payment and you need to respond formally, Claim Done’s Legal Response service prepares a detailed written reply based on your contract and evidence.

You upload your contract, invoices, communications, and a brief explanation of the dispute. Claim Done’s Programmatic Algorithms analyse the documents, identify the valid and invalid portions of the claim, and draft a response that:

• Sets out what you acknowledge owing
• Disputes the invalid charges with specific reasons
• Cites the relevant contract terms and Australian Consumer Law provisions
• Proposes a resolution pathway
• Establishes a clear record if the matter proceeds to tribunal

The response is prepared in about 5 minutes for a flat fee. No hourly billing. No retainer. Just a clear, professional document you can send directly to the contractor.

If the dispute escalates to tribunal, Claim Done also offers a Tribunal Response / Defence Pack that drafts a response summary, a defence position statement, a chronology and an evidence list. It does not prepare witness statements or legal submissions.

Final Checklist: Refusing Invalid Demands

Before refusing payment, confirm:

• You have reviewed the contract and all written communications
• You can identify which charges are within the original scope
• You have evidence that variations were not properly approved
• You are willing to pay any legitimately owed amounts
• You have responded in writing with clear reasons
• You have kept copies of all documents and correspondence

If all of these are true, you are on solid ground to refuse the invalid portion of the contractor’s demand.

Those who proceed to tribunal rarely succeed when the client has documented their position properly.

The key is not ignoring the problem, but responding with precision. That is what separates a legitimate refusal from an invitation to escalate.

Frequently Asked Questions

Can a contractor increase the price after finishing the job?

Not unless the contract allows variations and you approved the additional work in writing beforehand. A contractor cannot unilaterally increase the price after completion simply because the job was harder or took longer than expected.

What is a variation clause in a building contract?

A variation clause sets out the process for changing the scope of work and adjusting the price. It typically requires written notice from the contractor, your approval, and documentation of the change before the extra work proceeds.

Do I have to pay for work I did not approve?

No. If the contractor completed work outside the agreed scope without your prior approval, you are not obligated to pay for it unless the work was genuinely necessary to complete the original scope or fix a safety issue.

What if the contractor threatens to sue me?

Respond in writing setting out what you acknowledge owing and what you dispute. If they file a tribunal claim, you must lodge a defence. Do not ignore a formal claim.

Can I withhold all payment if part of the invoice is wrong?

You should pay the undisputed portion and withhold only the amount in dispute. Withholding the entire payment when part is legitimately owed can weaken your position and expose you to interest or penalty claims.