Taking a deposit on a renovation job in Alberta

Taking money up front means you need a licence

In Alberta, a business that takes any payment before the work on a private home is finished, and that sells, negotiates or signs the contract in person away from its own place of business (usually at the customer's home), is a prepaid contracting business. It needs a prepaid contracting licence from Service Alberta.

The rules cover construction, repairs, renovations and improvements to private dwellings, including work like landscaping. Commercial buildings and work between contractors and subtrades aren't covered.

What the written contract has to include

Service Alberta's checklist includes: your business name, address and phone number; the date and place of the contract; a detailed description of the materials and the work; itemized prices; the total price including taxes and the payment terms; start and completion dates; a statement of the customer's cancellation rights; and both signatures.

The customer must get a copy of the signed contract on or before the day work starts, or within 10 days of signing, whichever comes first.

The customer can cancel within 10 days

For prepaid and direct-sales contracts, the customer can cancel for any reason within 10 days of receiving their written copy. The right to cancel extends to one year if you needed a licence and didn't have one, if the contract is missing required information, or if you don't start within 30 days of the agreed date.

In practice: set the deposit to cover materials you'll order, say when work starts, and keep the cancellation statement in the proposal.

How Scopewright helps

Scopewright proposals show itemized lines, your tax rate and your payment milestones (for example, 25% deposit on acceptance). When a customer accepts, you can create a deposit link from the job page. It's a card payment on your own Stripe account.