How long retention can be held is set by your contract, not by a statute. There is no general law capping the period. The defects liability period written into the agreement you signed is the clock, and most contractors have never read that clause.
That is why the question feels unanswerable when a client sits on your money at month nine. The answer is in your own file, and it takes four minutes to find.
What is actually being held
Put the arithmetic on the table first, because the sums are larger than the percentage sounds.
Five percent is the market standard. It is not a legal one, and nothing stops a contract asking for more.
Take a R3 million contract at 5%. R150 000 is held across the works. Under the JBCC Principal Building Agreement half of that is released at practical completion, so R75 000 sits out the defects period afterwards. On a R10 million contract those figures are R500 000 and R250 000.
Now read the first number again, because it is the one that catches people. The R150 000 only halves when practical completion is certified. If that certificate has not been issued, nothing has been released, and the full R150 000 is still held at month nine on a job you finished in month four.
That is money you have already earned, already paid your subcontractors and suppliers out of, and already paid your people to produce. The margin on the whole job is frequently smaller than the retention still outstanding on it.
Two things decide when you see it. The certificate of practical completion, which halves the hold and starts the defects period, and the end of that period, which releases the balance. If neither document exists in writing, the clock has not started and nobody is going to tell you.
What it costs to carry
Most contractors treat retention as money that is late rather than money that is expensive. It is both.
R150 000 held for nine months costs you R1 125 for every percentage point of your overdraft rate. Prime stood at 10,5% on 31 August 2026, against a repo rate of 7,00% last moved on 28 May 2026. At prime, that same R150 000 costs R11 812 over the nine months, on one job. Most contractors do not borrow at prime. Put your own rate next to that and the number is larger.
The larger cost is invisible on the bank statement. Retention outstanding across three jobs is working capital you cannot use to price the fourth, and a guarantee facility that is full is a tender you do not enter. That is the cost nobody invoices for.
Month nine, and what to do about it
If retention is still held past the date your contract says it should have been released, there are three moves and they go in order.
- Find the trigger document. Get the certificate of practical completion in writing, with its date. Everything downstream runs off that date, and a verbal handover is not a date.
- Ask in writing, quoting the clause. Not a phone call. A letter naming the clause, the date the defects period ended, the amount outstanding, and a payment date. Most retention that is genuinely overdue moves at this step, because until now nobody at the client has had a document to act on.
- Use the contract's own dispute route. Under the JBCC agreement that is adjudication, at clause 30, and it exists precisely so that a payment argument does not have to become a court case. Read yours before you need it.
That third point is worth a paragraph on its own, because it runs on short clocks and most firms find that out late. Under JBCC a disagreement becomes a dispute if it is not resolved within ten working days of the notice. The party who gave that notice then has a further ten working days to give notice of adjudication. The adjudicator's determination follows within twenty working days of referral, it binds both parties immediately, and if neither side gives notice of dissatisfaction within ten working days it becomes final. Those are working days, and they are short enough that a firm reading the clause for the first time after the argument starts has already lost part of the window.
The sequencing is what most firms get wrong. Construction Management and Digital Construction Plus are running a webinar on disputes on 23 September, and its framing is the right one. The information you need in a dispute is information you should have been keeping before there was one.
Why the contract is the whole answer
South Africa has no shortage of construction regulation. What it does not have is a statutory cap on the retention percentage or on how long your money can be held after you have finished the work. The cidb and Master Builders South Africa have both called for capped retention and interest on late release, which tells you plainly that neither exists yet.
So the number and the clock are both negotiated, once, at signature, and never again.
The clock is shorter in the standard forms than most contractors assume, which is the useful thing to know before you sign an amended one. The JBCC defects liability period is ninety calendar days.
Under NEC4 option X16 the retention percentage is not in the printed form at all. It is whatever the Contract Data says. Half comes back at Completion and the rest at the Defects Certificate, with the defects date commonly set at fifty-two weeks after Completion.
A JBCC contract handed to you with the ninety days struck out and twelve months written in is a different deal. You can see that change in ten seconds if you know what the printed number is.
The other lever most contractors do not use is the form of the security itself. JBCC clause 14 gives a choice: a payment reduction, which is retention, or a variable or fixed construction guarantee. Take the guarantee and the money stays in your account while the client holds a bank instrument instead. It is not free, and on the arithmetic above it is frequently cheaper than the overdraft it replaces.
Public sector work sits under its own rules on which contract forms may be used, published by the cidb as procurement prescripts. That page carries the Standard for Uniformity in Construction Procurement and the Construction Industry Development Regulations, and a draft 2026 edition of the Standard has been out for comment. Neither the Regulations nor the Standard puts a cap on retention. If you bid public work the form is often not negotiable, which makes reading it before you price even more useful.
The part nobody negotiates
Retention exists for a reason. It is the only hold a client still has once you have left site, and a client who has been burned before is not going to give it up.
The honest position for a contractor is not that retention should not exist. It is that the period should be defined and the trigger should be a document with a date on it. The money should then be released when the snag list closes, rather than when somebody in accounts remembers.
Arabella sits between the client and the site, which means we hear the same retention argument from both ends of the same job, usually with both sides convinced the other is acting in bad faith. Almost always neither is. Neither has a dated document. What the verification covers is on the contractor page, and the compliance notices we read each week sit in insights.
On Monday
Open the contract on the job you finished most recently and find two things. The retention clause, and the date on the certificate of practical completion.
Write both on the front of the file. If the date the balance falls due has passed, send the letter today, quoting the clause and naming a payment date. If it has not passed yet, put it in the diary with a two week warning, because the release is not automatic and nobody at the client is watching that date for you.
