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Procedure for Modern Construction Invoicing and Payment

Procedure for Modern Construction Invoicing and Payment

1. Introduction 
This document outlines the invoicing and payment procedures for both lump sum pricing (divided into Off-shore and On-shore components) and Variations for the {Project Name}. It also includes the required formats for invoice documentation.

2. Invoicing Procedure

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Home Designs AI

2.1 General Conditions

– 2.1.1 Payment from the OWNER to the MAIN CONTRACTOR is contingent upon achieving the Physical Progress milestones outlined in the Contract.

– 2.1.2 OWNER’s approval is required to confirm satisfactory Physical Progress in the WORK.

– 2.1.3 ‘On-shore’ refers to services rendered within [Location], subject to local taxation. ‘Off-shore’ refers to work performed at the MAIN CONTRACTOR’s Head Office outside [Location], exempt from [Location] taxes.

– 2.1.4 Two invoices will be issued for each contract segment—On-shore and Off-shore. The On-shore invoice, including GST, will be issued by the [Location] Branch Office, while the Off-shore invoice, exempt from GST, will be issued by the MAIN CONTRACTOR’s Head Office.

– 2.1.5 Payments for the On-shore segment will be in USD, with GST amounts reflected in [Location] currency at the prevailing exchange rate on the invoice date.

2.2 Advance Payment

– 2.2.1 A 20% advance on the lump sum price will be invoiced post-submission of the requisite Bonds.

– 2.2.2 This advance is payable within 30 days, contingent upon receipt of the Performance and Advance Payment Bonds by the OWNER.

– 2.23 The advance will be amortized at a rate of 20% through deductions in subsequent certified payments.

– 2.2.4 This advance corresponds to 20% of the combined Off-shore and On-shore costs covering project management, engineering, procurement, and construction.

2.3 Progress Payment

– 2.3.1 Monthly statements will be submitted to both the OWNER and the Lender’s Engineer, detailing the MAIN CONTRACTOR’s payable amounts.

– 2.3.2 Statements include executed work value, adjustments (additions/deductions), and previous statement deductions, all backed by relevant documentation.

– 2.3.3 Payment allocations for Off-shore and On-shore will reflect the respective progress in project management, engineering, procurement, and construction.

Contractor Holds Money He Collected from His Accomplieshed Works

Contractor Holds Money He Collected from His Accomplieshed Works

2.4 Final Payment

– 2.4.1 The final balance will be settled as stipulated in the Contract, after adjusting for prior payments and deductions.

2.5 Payment of Variations

– 2.5.1 Adjustments for approved Variations will be made as per the Contract terms.

– 2.5.2 Invoices for Variations will be issued alongside regular invoices for clear delineation.

– 2.5.3 Payments for Variations will match the lump sum payment schedule unless otherwise agreed.

2.6 Required Documents for Invoices (Lump Sum)

– 2.6.1 Documents include: Statements split into Off-Shore and On-shore portions, calculations of Statement amounts, and Physical Work Progress reports.

– 2.6.2 Invoices should list: CONTRACT Name/Number, Invoice Details, Total and GST-exclusive CONTRACT prices, and banking information.

– 2.6.3 Lump Sum Invoices will also detail payment schedules and Work Progress Certificates.

2.7 Required Documents for Invoice Variations

– 2.7.1 Variation invoices will list Milestone numbers, Variation references and approvals, cumulative value, and the payable percentage of Variations.

– 2.7.2 Documentation will include breakdowns of invoice amounts and authorized Variation lists.

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