What should I put in a quote for building work?
A good quote says exactly what you are pricing, what you are not, what it is based on, what it costs, and how changes will be handled. The more of that is written down, the fewer arguments you have later.
Quote or estimate
In plain terms, a quote is usually a fixed price for the work as described, and an estimate is a best guess that can move. The words matter less than what was actually agreed, so say which you mean on the document and in conversation. If you call something an estimate, make clear what could change the figure.
If a homeowner agrees a job and no price is fixed, and the contract does not say how it will be fixed, the Consumer Rights Act 2015 section 51 says the customer pays a reasonable price and no more. What is reasonable is a question of fact. That is a good reason to put a price, or a method for working it out, in writing before you start.
What every quote should cover
- the scope of work, described clearly, and a list of what is excluded
- the drawings and specification it is based on, with revision letters and dates
- the price, and whether it includes VAT
- how long the price stands, for example 30 days, because material costs move
- payment stages: what triggers each payment and how much
- the start date, how long the work will take, and what you need from the client to keep to it
- who arranges and pays for waste removal, skips and permits, and who applies for any approvals
State the VAT position plainly. If you are VAT-registered, say if the figure is with or without VAT. For a homeowner, show the total price including VAT, because that is the figure they will pay. HMRC publishes guidance on VAT on building work, so check the rate for your job rather than assuming.
Provisional sums and prime cost sums
These are allowances for things that cannot be priced yet. They are common words in building contracts, but check that your client knows what they mean.
- a provisional sum is an allowance for work that is not yet defined, such as groundworks that depend on what is found when you dig. The final cost is measured and adjusted once the work is known
- a prime cost sum is an allowance for an item you will buy but the client has not chosen yet, such as tiles or a kitchen. If the client picks something dearer, the difference is added; if cheaper, it comes off
Mark each one clearly as an allowance, give the figure, say what it covers, and say what it does not include, such as fitting. Do not bury them in the main price.
Variations
Say in the quote how changes will be priced, and that you will agree them in writing before doing the work. Common methods are a fixed price for the change, daywork at stated hourly rates, or measured rates from a schedule. Whichever you choose, put the rates or method in the quote and keep a signed record of each change.
Cancellation information for homeowners
If you agree a contract with a homeowner away from your own premises, for example in their home, the Consumer Contracts Regulations 2013 say you must give them certain information before they are bound. Regulation 10 requires it on paper, or on another durable medium if they agree, together with a cancellation form where a right to cancel exists. Schedule 2 lists the information, which includes the main characteristics of the service, the total price including taxes (or how it is worked out), and the arrangements for payment and performance. Our guide on whether a homeowner can cancel a building contract within 14 days covers what to give them.