Final invoice unpaid: what trades businesses should do now when the customer will not pay

When does the final invoice fall due?

Under the Austrian Civil Code (ABGB), the contract price is generally payable once the work is completed. Completed means: finished and taken over by the customer. The takeover does not have to be formal. It can also happen implicitly, for example through payment, through use, or through an inspection after which the customer does not reject the work within a reasonable time. Defect complaints do not delay the takeover as long as the customer does not reject the work as a whole. However, the contract price only falls due once the customer has had the opportunity to inspect the work.

Whether you also need an invoice depends on the price agreement. With a lump-sum price, the contract price is due without an invoice. If you bill by unit prices, measurement or daywork hours, it only falls due when the invoice is received, and you must issue it within the customary period. If you let the final invoice slide, you postpone your own payday. The three-year limitation period nonetheless starts as soon as you could have issued the invoice.

Between businesses the following also applies: an acceptance or inspection procedure may last at most 30 days, unless a longer period has been expressly agreed and is not grossly unfair to you. A payment term of up to 60 days is permissible in any case.

For every unpaid final invoice, note three dates: takeover, invoice date and receipt by the customer.

If the ÖNORM B 2110 has been agreed

An Austrian standard (ÖNORM) only applies if it has been agreed in the contract. Many construction contracts still refer to the 2013 edition of ÖNORM B 2110. Under that edition, final invoices fall due three months after receipt unless otherwise agreed, and the client must return a defective final invoice for correction within 30 days. A new edition has existed since May 2023. Which edition and which deadline apply to you is set out in your contract.

Pay particular attention to the reservation: if the client cuts the final payment, under the ÖNORM you must object in writing, with reasons, within three months of receiving the payment. Otherwise further claims for the work performed are excluded. Check every reduced final payment immediately and put a deadline in your calendar.

Defect complaint or excuse: what may the customer withhold?

This is the key difference from other unpaid invoices. If the work has a defect, the customer in Austria may withhold the entire outstanding contract price until it is remedied, not just the cost of the repair. In principle this also applies to minor defects. The limit is chicanery, meaning a gross disproportion between the outstanding contract price and the cost of the remedy. There is no fixed percentage threshold. The Austrian Supreme Court (OGH) denied a full right of retention where the remedy cost around 2 per cent, and saw no chicanery at 15 per cent. If your work is divisible, for example with separate trades, the customer may only withhold for the defective part.

The right of retention requires the customer to want the remedy and to allow it. If they refuse it or demand a price reduction instead, they can no longer block the entire amount.

Here is how to proceed:

• Ask for a specific description of the defect: where, what, since when.
• Offer a date for inspection and remedy in writing.
• Remedy justified defects quickly and have the remedy confirmed with date and photos.
• Document it if the customer cancels appointments or refuses access.
• Respond to unjustified complaints in writing and with reasons.

Resolve disputed defects first, because no reputable collection agency takes on disputed claims. However, if the customer only disputes individual items, such as a variation or a quantity in the measurement, and not the absence of defects in the work, the rest is undisputed and can be handed over.

Retention for warranty and retention for cover: which amount is due now?

Many construction contracts provide for retentions, either directly or via ÖNORM B 2110. They are decisive for the question of what you can demand now.

The retention for cover (Deckungsrücklass) is withheld from interim invoices and is intended to cover overpayments until the final invoice. It is settled with the final invoice. So it belongs in the amount you demand now.

The retention for warranty (Haftrücklass) secures the warranty. If it has been agreed, this part of the contract price only falls due later, usually after the warranty period, which is three years for buildings. A warranty retention is therefore not a payment default and does not belong in collection. It can often be replaced by a bank surety (Bankgarantie) if the contract provides for this.

Take the warranty retention out of the outstanding amount and put the release date in your calendar.

Security under the ABGB: your leverage on construction jobs

Little known but effective is the security for construction contracts. Anyone working on a building or part of one can demand security from the customer for the outstanding price: up to one fifth of the agreed price, or up to two fifths for jobs to be completed within three months. This right cannot be excluded by contract. Cash, savings books, bank sureties or insurance can serve as security. You bear the costs up to 2 per cent of the secured sum per year.

The OGH allows the demand until full payment, i.e. also after completion, also for a withheld warranty retention and also if the customer alleges defects. If the customer does not provide the security within a reasonable time, you may refuse further work and, after a reasonable grace period, terminate the contract. You are then entitled to the price less what you have saved, and the customer can no longer argue that the price is not yet due because of defects.

Two limits apply: there is no such claim against consumers or legal entities under public law. And you cannot sue for the security itself; your leverage is termination of the contract. Because this is a sharp instrument, get legal advice before declaring termination. The demand itself is informal, but send it in writing anyway with the amount and a deadline.

Example: final invoice for 18,400 euros

Example: a plumbing and heating business in Graz renovates the bathrooms and heating in an apartment building for a property developer. Billing is by unit prices; the ÖNORM has not been agreed. A warranty retention of 3 per cent until the end of the warranty period and a 30-day payment term have been agreed.

After receiving the final invoice, the developer complains about a leaking silicone joint and pays nothing at all. The business immediately offers a date in writing, remedies the defect the following week and has the remedy confirmed with photos. That ends the right of retention. The developer still does not pay and ignores two reminders.

The business now hands over the undisputed 4,448 euros for collection. The developer additionally owes late-payment interest of 10.73 per cent a year, 39.23 euros for 30 days, and the 40-euro lump sum between businesses. These costs of default are borne by the developer, not by the business. For the disputed variation, the business gathers its records and has it reviewed separately. At the same time it demands security for the warranty retention of 552 euros, and for the variation once its commissioning has been clarified. Both together, 2,952 euros, are below one fifth of the agreed price.

Which documents do you need for the handover?

The better the records, the less room for excuses. Keep these documents ready:

• quotation and order or works contract, noting whether ÖNORM B 2110 has been agreed
• variations with proof that they were ordered, for example by email or signed
• daywork reports signed by the customer or the site supervisor
• measurements, ideally taken jointly
• dated photos before, during and after the work
• takeover record or other proof of takeover such as emails, use or moving in
• final invoice with proof of receipt, interim invoices and list of payments
• defect complaints, your replies and proof of remedy
• reminders and the latest correspondence

Sort the records by invoice item. Then any third party can see at a glance which amount is based on what.

When is a handover worthwhile, and how does it work at incaseof.law?

Hand over as soon as the amount is due and undisputed and the customer keeps putting you off or stays silent. This also applies to general contractors and property developers. Do not wait too long: in Austria, claims for the contract price become time-barred three years after they fall due, and a reminder does not stop this period. Monitoring the deadline remains your responsibility; if limitation is imminent, point this out explicitly at handover. If the customer is a business, late-payment interest in the second half of 2026 is 10.73 per cent a year. The late-payment interest calculator works out the amount for your invoice.

incaseof.law is a licensed debt collection institute in Austria, registered in Germany. You register in the client portal, enter the customer, amount and due date, and upload the final invoice and supporting documents. Due, undisputed claims with documented payment default are accepted. The case team decides on the reminder stages. If the customer still does not pay, the case team recommends the next step. A payment-order claim (Mahnklage) is only filed after your approval; there are no automatic court filings. How the court procedure works is explained in our guide to the payment-order claim in Austria.

100 % of the principal claim goes to you; the defaulting customer bears the default costs within the legally permitted limits. Recovery and duration are not guaranteed. In regular out-of-court collection there are no costs from incaseof.law, even if the debtor does not pay, and no success fee on your principal claim. Court fees and, in Austria, MANZ transmission fees only arise once you approve court proceedings. Everything about handing over claims from the trades is on our page on debt collection for trades. If the customer simply does not pay, our guide Customer not paying? What businesses can do next also helps.