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Kitchen, bathroom and laundry contracts in NSW

A written contract is required when carrying out home building work more than $5,000 in NSW. This would include works associated with new or renovated kitchens, bathrooms, and laundries.
Tuesday, 19th May 2026

Whenever using a contract, it is important that you understand its terms and know how to administer it correctly. Below is a summary of some of the important provisions of the HIA Kitchen, Bathroom and Laundry (KBL) Supply and Install contract for use in NSW.

Before you sign the contract

Before signing a kitchen, bathroom or laundry contract in NSW, it’s important to understand your key obligations around insurance, deposits and payment claims. This section explains when Home Building Compensation cover is required, the maximum deposit you can charge, and how to correctly structure and claim progress payments under the contract.
What insurances do I need to have?
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Home warranty insurance

If the work you will be doing is valued at more than $20,000, you need to take out insurance under the Home Building Compensation (HBC) Scheme (often referred to a Home Warranty Insurance or HBCF) unless an insurance exemption applies, which might apply for some KBL works. You must not carry out such residential building work or demand or receive any part of the contract price until insurance is in force and the client has been provided with a certificate of insurance.

If you are contracted to do residential building work that consists only of built-in furniture work, and any incidental electrical wiring work involved in the installation of lighting as part of built-in furniture, the contract is exempt from the requirements to take out insurance under the HBC if the work is done under a separate contract and not as part of a contract for other residential building work. 

For the purposes of this exemption, built-in furniture work means the making and installation of furniture that is made to measure and fixed to a dwelling (such as built-in cupboards, bench tops, wardrobes, entertainment units and the like), and which may be made off-site and installed as a complete unit.

The KBL contract includes a note at Item 9 of Schedule 1 regarding this exemption. If your works are exempt, you should highlight this note to the owner, and item 13 of the Consumer Checklist.

Public Liability

Your contract requires that you take out public liability with a cover of at least $10 million.

If the owner tells you to insure the products you will be installing against loss or damage occurring after they are delivered to site or to similarly insure the owner’s property whilst you are carrying out the installation, you can charge this extra cost back to the owner plus another 20% for arranging the insurance.  

For more information, contact HIA Insurance Services on 1800 633 467. Or visit the website:

HIA Insurance Services    Home warranty insurance
How much can I take as a deposit?
{{ propApi.expandedIcon }} {{ propApi.collapsedIcon }} In NSW, the amount that you can charge as a deposit is a maximum of 10% of the contract price for all work regardless of the value of the work.
How do I get paid?
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The Kitchen, bathroom and laundry contract allows you to nominate progress stages that will act as a trigger for payment. The amount claimed under each stage should reflect the actual value of work completed within that stage. For fixed priced contracts, you will be able to claim a progress payment following the completion of the stage of work. It is important that the work described in a progress stage is complete before submitting a claim. Each stage must be described in clear and plain language.

Should you choose to use a HIA Works on a Cost Plus Basis contract for your building works, you will be able to make a progress payment claim for labour and materials already performed or costs already incurred at intervals fixed by the contract or on an ‘as invoiced’ basis and can include a margin. These claims for progress payments must be supported by invoices, receipts or other supporting documentation.

Signing the contract

Once the contract is signed, you need to understand how to correctly manage provisional sums, extensions of time, variations and payment disputes. This section explains when the contract price can change, the steps required to claim additional time, why variations must be in writing, and what options are available if a client fails to pay. 
What happens if at the time of entering the contract the owner has not made certain selections and so I cannot cost these items accurately?
{{ propApi.expandedIcon }} {{ propApi.collapsedIcon }} The contract contains a clause that allows you to include “provisional sums” in your contract price. Each provisional sum item must be listed in the appropriate schedule of the contract and have an allowance stated next to it for the estimated cost of that item or cost of providing the work. The owner must pay the actual cost of the item so where that cost is more or less than the allowance, the contract price will be adjusted, plus the addition of the margin specified in the contract.
When am I able to claim an extension of time?
{{ propApi.expandedIcon }} {{ propApi.collapsedIcon }} You are entitled to claim an extension of time for things that are beyond your control, e.g. if the owner fails to make a selection, does not have the site ready for installation or does not give you access to site. You need to ensure that you claim these extensions of time by giving written notice to the owner in accordance with your contract.
Do variations need to be in writing?
{{ propApi.expandedIcon }} {{ propApi.collapsedIcon }} Yes. They need to be in writing and signed by the parties before you vary the contract. The process for variations is set out in the contract and must be followed.
What happens if the client does not pay a progress stage?
{{ propApi.expandedIcon }} {{ propApi.collapsedIcon }} You should first discuss this issue with your client to find out why – it could be a simple misunderstanding. However, if the client is in serious breach of their obligations, you may give them a written request to remedy the breach within 14 days. This is a necessary step if you intend on terminating the contract on account of the serious breach. The contract provides that you are entitled to interest on late payment.

On-site

Once work starts on site, it’s critical you understand each party’s responsibilities around site access, trades, safety and unpaid work. This section explains the owner’s obligations to provide access and prepare the site, what happens when owners engage their own trades, and the risks involved in attempting to recover installed materials where payment disputes arise.
What happens if I am finding it difficult to get access to site?
{{ propApi.expandedIcon }} {{ propApi.collapsedIcon }} Your contract provides that the owner must give you unrestricted access to the site to check, measure, deliver and install the product as well as to rectify any defects. If the owner fails to afford a contractor their rights under the Home Building Act to return to the site to rectify any defects, the owner may be held liable for failing to take reasonable steps to mitigate their loss.
What if the owner is contracting their own specialist trades, e.g. electricians and plumbers?
{{ propApi.expandedIcon }} {{ propApi.collapsedIcon }} The contract provides that if the owner is to provide plumbing and electrical services or will supply or install appliances, they must have the site ready and the appliances available at least 24 hours before you install your product (cabinets etc). The owner must also use licensed trades.
What happens if the owner has animals?
{{ propApi.expandedIcon }} {{ propApi.collapsedIcon }} The owner is responsible for the safekeeping, control and supervision of domestic animals on the site. It is a good idea to remind your client of this prior to starting work if the animals could place your workers at risk, or your work could place the animals at risk or there is a chance the animals could escape.
If I have not been paid can I take back the materials that I have installed?
{{ propApi.expandedIcon }} {{ propApi.collapsedIcon }} The contract does contain a ‘retention of title’ clause. However, these types of clauses can be very difficult to enforce and relate to a very complex area of law. It is therefore important that you seek legal advice prior to taking any action to recover your goods that have been installed.
Where can I go for further assistance in understanding my contract?
{{ propApi.expandedIcon }} {{ propApi.collapsedIcon }} HIA has a team of Contracts and Compliance Advisors who are available to assist you in understanding your contractual rights and obligations.

To find out more, contact HIA's Contracts and Compliance team

Email us

The above is intended to provide general information in summary form. The content does not constitute specific advice and should not be relied upon as such. Formal advice should be sought by members and customers with respect to particular matters before taking action.
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