Before the next construction payment: what evidence should you request?

A date on the calendar is not proof of progress

A date can trigger a reminder. A payment should be tied to an obligation.

For each material instalment, the file should show:

1. the contractual milestone;
2. the approved drawings/specification and measurable scope behind it;
3. current site evidence and measurement;
4. inspection by a competent architect, engineer or quantity surveyor whose appointment and possible conflicts have been checked;
5. the effect of defects, incomplete work, materials off site and previous overpayment;
6. approved variations and time consequences;
7. the correct invoice, tax, account and release authority;
8. the balance and security remaining for completion, handover and defects.

The investor is not trying to micromanage a building site. The objective is simpler: do not let cash run materially ahead of verified value, control and remaining remedies.

Measurements that answer different questions

Match each payment to evidence

There is no universal “correct” percentage schedule. A bespoke villa, a multi-unit estate, a land lease plus build and a completed-unit sale do not carry the same risks. What can be universal is the discipline: define the trigger, evidence it, reconcile the money, preserve enough leverage to finish.

For a transaction that falls within the housing PPJB rules in PP 12/2021, keep two thresholds separate. The 20% construction test is one of the conditions that must be satisfied before the PPJB stage. For detached or row houses, it concerns at least 20% of all planned units plus the planned infrastructure, facilities and utilities; for an apartment building, it concerns 20% of the building's construction volume. It is not 20% of the buyer's villa and not a standard payment milestone. Separately, the developer may not collect more than 80% until the relevant PPJB conditions are satisfied. That limit is not a statutory escrow account. Counsel must first confirm that the housing PPJB rules apply to the transaction.

Agree the baseline before measuring progress

You cannot measure a render.

The payment baseline should include, as applicable:

• signed contract and complete party/capacity details;
• issued-for-construction architectural, structural and MEP drawings;
• specification and approved material/equipment schedule;
• bill of quantities, schedule of values or other measurement basis;
• programme with critical approvals, utilities, procurement and commissioning;
• responsibility matrix;
• approved contract price and contingency treatment;
• definition of each milestone and required evidence;
• inspection, notice, payment and dispute timetable.

If the design remains intentionally incomplete, the contract must expose that uncertainty. It should not present a fixed price and fixed delivery date while leaving the most expensive details to later “client upgrades”.

Five checks before payment

1. Written request: amount due, contractual milestone, invoice, payee, bank account, supporting documents and cumulative payment position.
2. Site evidence: dated inspection record, photographs tied to locations, test results, delivery records and an updated schedule.
3. Independent review: a competent architect, engineer or quantity surveyor checks only the work covered by their written appointment and states any exclusions or conflicts.
4. Contract check: confirm the milestone, approved changes, delay notices, outstanding defects, security and the estimated cost and time still needed to finish.
5. Payment record: pay only to the verified contractual account after the authorised decision-maker approves it, then retain the certificate, invoice, payment confirmation and conditions for the next instalment.

Changes: when a fixed budget stops being fixed

A variation should answer five questions before work, except under a tightly defined emergency procedure:

1. What changed, and why?
2. Who had authority to instruct it?
3. What drawing/specification replaces the old one?
4. What is the price basis and tax effect?
5. What is the programme and completion impact?

Maintain one register:

“Included in next invoice” is not a variation process. Nor should the investor be asked to approve price after the replacement is already concealed in the work.

Money withheld until completion, and other security

Retention can preserve money until defined completion and defect gates. It is only as good as its drafting:

• percentage/base;
• cap;
• who holds it;
• first release trigger;
• second/final release trigger;
• right to apply it to uncorrected defects;
• insolvency and termination treatment;
• interaction with bonds, guarantees and final account.

It is not always present and no percentage should be described as universally required.

Likewise, an advance-payment guarantee, performance bond, bank guarantee, escrow or parent guarantee must be read as an instrument, not as a label. Check issuer, beneficiary, amount, expiry, reduction, demand conditions, defences, governing law and whether the security survives the period when risk exists.

Handover has four separate parts

The contract may structure these differently. The analytical point is that one signature should not accidentally certify four different things.

Example: replace six calendar payments with five evidenced stages

All entities, percentages, dates and facts in this worked example are fictional and illustrative.

The brochure proposes:

• 20% reservation/signing;
• 20% after 60 days;
• 20% after 120 days;
• 20% after 180 days;
• 15% at “completion”;
• 5% at key handover.

The reviewed structure might instead distinguish:

1. Initial release: transaction/land authority, reviewed contract, baseline and essential pre-construction conditions satisfied; any true advance separately secured or consciously priced.
2. Substructure gate: measured and tested foundations/substructure under approved structural documents, with cumulative certificate.
3. Weather-tight structure gate: defined structure, roof and envelope complete to specification; concealed tests/inspections filed.
4. MEP and finishes gate: first/second fix and finishes measured by package; commissioning dependencies and variations reconciled.
5. Handover and close-out: physical completion release, separate documents/operational conditions, then retention/defect release.

Dates remain in the programme and longstop remedies. They stop pretending to be evidence of construction.

Limits of this payment check

It does not:

• create a right to withhold, inspect, enter the site or terminate if the contract lacks it;
• decide which housing/PPJB or construction rules apply to your transaction;
• make the certifier independent or liable without a proper appointment;
• detect hidden defects without the required inspections/tests;
• guarantee completion, funding or contractor solvency;
• make escrow, bonds, retention or milestone payments universally mandatory;
• replace land, permit, tax, insurance or operating due diligence;
• determine the tax invoice/withholding/VAT answer without the exact parties and supply.

Build a record for the next payment

Use the Bali property due diligence guide to organise the project evidence before assessing a payment request. Review construction quotes and scope, then test how the construction period and remaining leasehold term affect the exit assumptions.

Before the next transfer, ask for one complete, well-organised file containing the cumulative certificate, current site evidence, the approved variation register, payment reconciliation, an updated cost and completion forecast, and the conditions that must be met before the following payment. This is a standard request for evidence.

Official sources and date consulted

Official sources consulted on 15 July 2026. Official anchors: PP 16/2021 for the building system and distinct PBG/SLF functions; Permen PU 6/2025 for the current construction-business/workforce certification framework; Permen PKP 18/2025 for housing-sector business standards within scope; Permen PUPR 24/2018 for its housing-developer certification/registration framework; SE 05/SE/Dp/2026 for the SIRENG service and its stated government-assisted/financed/incentivised housing monitoring context; SE 06/SE/Dp/2026 separately for formats/mechanisms of applicable housing-business obligations and sanctions; PP 12/2021 for the housing/PPJB framework where it applies. The relationship between Permen PUPR 24/2018, SE 05/2026 and current SIRENG coverage requires confirmation from the relevant Indonesian professionals. No registry result should be treated as project approval, a whitelist or proof of title, solvency, payment protection, delivery, quality or safety.

The milestone, retention, variation, security and handover measures above are contractual safeguards, not a claim that Indonesian law imposes one universal model. Before using them, have Indonesian counsel examine the transaction and contract, agree the inspection and payment procedure with the appointed architect, engineer or quantity surveyor, confirm the construction qualifications required for each work package, obtain Indonesian tax advice on the payments, and have every bank instrument or security examined. Reopen the official sources on the decision date.