Milestone billing raises invoices or demands when defined stages of work are reached, rather than at fixed intervals. It is the standard arrangement in construction and property development, where cash needs to follow progress on site.
Two sides of the same stage
On a development, one construction stage usually drives two flows of money. The contractor certifies work done and bills the developer; the developer raises a demand on buyers whose payment plan is linked to the same stage. When both refer to the same defined stage, the project's cash position is coherent. When they are tracked separately — a common arrangement — demands get raised against stages the site has not reached, and that is discovered by an unhappy buyer.
What a stage has to be
A billable stage must be observable and agreed. "Slab cast for level four" can be verified; "structure substantially complete" invites a dispute at the moment money changes hands. Where a stage is measured rather than observed, the measurement itself needs a record — a certified quantity with no measurement behind it cannot be defended.
What sits alongside it
- Retention — a percentage held back and released later, which must be held against the contract rather than remembered.
- Advances — paid up front and recovered across bills.
- Variations — work outside the original scope, billed against agreed rates.
