--- title: "Accounts receivable management for construction companies & contractors" description: "Accounts receivable management for construction companies & contractors: outsourced accounts receivable: aging reviews, statements, dunning sequences." url: https://ledgerbpo.com/industries/construction/accounts-receivable/ updated: 2026-09-11 publisher: LedgerBPO (SS Support Network LLC) language: en-US --- # Accounts receivable management for construction companies & contractors Accounts receivable for construction companies & contractors is shaped by pay-when-paid clauses, retainage and lien deadlines. A pay app approved this month may not fund for 45 to 75 days, and retainage on top of that waits until closeout. Your accountant ages receivables by job, separates retainage from current billings and runs follow-up through our DunningDesk cadence, contacting the general contractor's AP desk under your company name. - Since 2020 - US · UK · CA · AU - Named accountant plus backup - Your software, no lock-in [Get a custom quote](https://ledgerbpo.com/get-a-quote/) [Book a 20-minute call](https://ledgerbpo.com/book-a-call/) Updated September 2026 ## How it runs for construction companies and contractors Preliminary notice and lien deadlines are logged per project so you keep your rights while staying polite. Weekly, you see which pay apps are approved, which are disputed and which need a call. ## What is accounts receivable outsourcing? Accounts receivable outsourcing means a remote team manages the money your customers owe you: tracking invoices from issue to payment, sending statements and reminders, logging disputes, and reporting aging and days sales outstanding. The provider works inside your accounting software under your brand. You keep the customer relationship and decide on credits, holds and escalations. ## What we handle for construction companies and contractors - Receivables aged by job with retainage shown on its own line - Pay-app status tracked from submitted to approved to funded - Follow-up calls and emails to GC accounts payable under your brand - Preliminary notice and lien deadlines logged per project and state - Short-pay and back-charge disputes documented with supporting pay apps ## The KPI that matters here Percentage of pay apps funded within contract terms, reported weekly per general contractor. ## Construction compliance notes ### Sales tax on materials In most US states a contractor pays sales tax on materials at purchase and does not charge tax on the finished job. A few states, including Arizona and Washington, tax the contract itself, and many states have separate rules for repair work versus new construction. We set up tax codes per state and contract type and track exempt purchases with resale or project certificates on file. ### Retainage Retainage withheld by owners is recorded as retainage receivable, and retainage you withhold from subcontractors is recorded as retainage payable. Several states cap retainage on public work, commonly at 5%, and set release deadlines after completion. We track the release date per contract so closeout billing goes out on time. ### Job costing and WIP Bonding companies and lenders expect a work-in-progress schedule that ties to the general ledger, with contract value, costs to date, estimated cost to complete and billings to date. We maintain the schedule monthly and book over and under billing entries so the P&L reflects percentage of completion. ### CIS in the UK Under the Construction Industry Scheme, UK contractors deduct 20% from registered subcontractors and 30% from unregistered ones, and file a monthly CIS return with HMRC. We verify subcontractors, prepare the deduction statements and CIS return workings, and reconcile deductions suffered against your PAYE liability. Your accountant or the business submits the return. ## Construction software we work in - [QuickBooks Online](https://ledgerbpo.com/software/quickbooks-online/) - [QuickBooks Desktop](https://ledgerbpo.com/software/quickbooks-desktop/) - [Xero](https://ledgerbpo.com/software/xero/) - [Bill.com](https://ledgerbpo.com/software/bill-com/) - [Gusto](https://ledgerbpo.com/software/gusto/) - [Sage 50](https://ledgerbpo.com/software/sage-50/) - Buildertrend - Procore - [All 50 platforms](https://ledgerbpo.com/software/) ## More for construction companies and contractors Other services for construction - [Bookkeeping](https://ledgerbpo.com/industries/construction/bookkeeping/) - [Invoicing and billing](https://ledgerbpo.com/industries/construction/invoicing-and-billing/) - [Accounts payable](https://ledgerbpo.com/industries/construction/accounts-payable/) - [Bank reconciliation](https://ledgerbpo.com/industries/construction/bank-reconciliation/) - [Month-end close](https://ledgerbpo.com/industries/construction/month-end-close/) - [Financial reporting](https://ledgerbpo.com/industries/construction/financial-reporting/) - [All construction services](https://ledgerbpo.com/industries/construction/) Accounts receivable in other industries - [Marketing agencies & consultancies](https://ledgerbpo.com/industries/agencies/accounts-receivable/) - [Auto repair shops & dealerships](https://ledgerbpo.com/industries/auto/accounts-receivable/) - [Behavioral health practices](https://ledgerbpo.com/industries/behavioral-health/accounts-receivable/) - [Daycares, schools & education](https://ledgerbpo.com/industries/childcare-education/accounts-receivable/) - [The full accounts receivable page](https://ledgerbpo.com/services/accounts-receivable/) ## Frequently asked questions ### Do you make collection calls to general contractors? Your accountant makes first-party follow-up calls and sends reminders under your company name to the general contractor's accounts payable team. The tone is professional and focused on pay-app status, missing documents and expected funding dates. We are not a collection agency and never present ourselves as one; our role is to keep your receivables moving. ### How do you track lien and preliminary notice deadlines? Each project is logged with its state, first and last furnishing dates and the notice rules that apply. The accountant flags jobs approaching a deadline in the weekly report so you can decide whether to file a notice or lien through your attorney. We track the dates; we do not give legal advice or file documents. ### How do you handle retainage that is overdue after closeout? Retainage receivable is aged from the contractual release date, not the original invoice date. Once substantial completion and closeout documents are confirmed, the accountant issues the final retainage invoice and follows up on the same cadence as any other billing. Overdue retainage is listed separately in the weekly report so it is never forgotten. Next step ## Books closed. Invoices paid. Every month. Tell us what is going on with your books or billing. You will hear from a named person within 1 business day, with a custom quote and a plan for the first close. - Reply from a named person within 1 business day - No setup fee, month-to-month - Your software, your data, no lock-in Start with a custom quote [Get a custom quote](https://ledgerbpo.com/get-a-quote/) [Book a 20-minute call](https://ledgerbpo.com/book-a-call/) Or call [+1-657-777-0006](tel:+16577770006) during US, UK or Australian business hours. --- Source: https://ledgerbpo.com/industries/construction/accounts-receivable/ · Contact: https://ledgerbpo.com/contact/ · Full site map for agents: https://ledgerbpo.com/llms.txt