How to Protect Your Deposit When Hiring a Tradesperson

If you’ve ever invested on work in your home before, you’ll know the process well. And that typically, larger jobs require a deposit to be paid. It’s a standard industry practice that secures your place in the contractor’s schedule. Legally, a contractor cannot use any of this deposit for the works.

However paying money upfront can feel risky, especially if you’ve heard horror stories of rogue traders taking deposits and disappearing. So, how can you protect yourself and ensure your money is safe?

Here’s what else every homeowner should know about safely paying a deposit to a tradesperson.

Why do tradespeople ask for deposits?

In most cases, requesting a deposit is a standard practice. It shows mutual commitment between you and the contractor and helps secure your place in a busy schedule.

It’s important, though, to be sure it’s handled properly and you’re not handing over more than necessary, or without the proper protection.

How much is a reasonable deposit?

As a general rule, you should never pay more than 25% or £7,500 (whichever is the lesser) of the total job value upfront.

For very small jobs, no deposit is necessary. For larger projects like an extension or a re-fit it’s not uncommon to pay in stages, with a smaller deposit followed by milestone payments.

If a tradesperson requests 50% or the full amount before work begins, be wary, because this is outside standard practice and should raise questions.

Six ways to safeguard your deposit

1. Use a CPA-Accredited tradesperson

Working with a CPA-accredited installer means you can protect yourself through an official Deposit Protection Scheme. This insurance-backed policy offers valuable protection should a contractor cease trading. Every policy is different, so be sure to read the terms and conditions carefully and ensure you are satisfied with the coverage it affords you.

2. Get everything in writing

Never hand over money without a signed, detailed contract. This should outline:

• The deposit amount
  
  

• When the remaining payments are due
  
  

• Clear start and end dates for the work

This written agreement gives you a legal foundation if anything goes wrong.

3. Never pay anything in cash

Cash is untraceable and offers no consumer protection. Always pay by credit card because this offers protection under Section 75 of the Consumer Credit Act

This creates a digital paper trail and helps you in the event of disputes.

4. Research the company thoroughly

Before you commit, do your homework:

• Check if the company is a CPA member
  
  

• Look for online reviews (on independent platforms, not just testimonials on their website)
  
  

• Ask for references from previous clients.
  
  

• Look at their portfolio or case studies.

A reputable contractor will welcome these checks; it shows you’re serious about quality, just like they are.

5. Agree on a stage payment plan for bigger jobs

If your project spans several weeks or months, always make the payments via credit card.

This keeps both parties accountable and reduces your upfront risk.

6. Request proof of deposit protection

If the contractor is offering deposit protection, ask to see the certificate. If they’re a CPA member, they’ll have access to one once the deposit is paid.

If they can’t show you anything in writing, assume you aren’t covered.

There are plenty of trustworthy, skilled contractors across the UK, but that doesn’t mean you should part with your money without protection.

By working with a CPA-accredited tradesperson and understanding your rights, you can pay a deposit with confidence and focus on the exciting parts of your home improvement journey.

Remember, protecting your deposit is just as important as choosing the right tiles or window frames!