What it means
Under Alberta's lien legislation, an owner is generally required to hold back a set percentage of the value of the work as it is done. The money is held for a defined period after the work is complete, which allows anyone who was not paid to register a lien if needed.
The exact percentage, timing and release rules come from the Prompt Payment and Construction Lien Act and the contract, so owners should confirm the details with their lawyer.
Why it matters
Holdback protects the owner from paying twice for the same work. It also protects trades and suppliers further down the chain. Releasing it too early, or failing to hold it back, can expose an owner to claims.
For contractors, holdback affects cash flow, because a share of the contract value is paid late.
How HSM handles it
HSM tracks holdback on every project and shows it clearly on each invoice and payment application. We keep our paperwork current so the release can happen on time once the lien period ends.
Our self-performed trades also simplify the picture. When our own electrical, mechanical, drywall, carpentry and painting crews do the work, there are fewer subcontractors and suppliers in the payment chain, which means fewer parties whose claims need to be managed at close-out.
We encourage clients to talk to their lawyer about holdback, and we will provide the documents they need.
What to plan for
Ask your lawyer how holdback and its release apply to your project, and tell us what documents your lender or landlord needs before releasing funds. Early questions avoid delays at close-out.