Schedule of values for subcontractors: build one that gets paid

Your schedule of values is the single document that decides how easily you get paid every month for the life of a job. Break the contract into the right line items and each progress bill is a five-minute update the general contractor approves without a fight. Break it into the wrong ones and every draw turns into a negotiation about what "40 percent complete" means on a line that lumps three scopes together.

We built SubTrade inside Quality Gypsum Services, a commercial drywall contractor in Calgary, Alberta, and the schedule of values, the SOV, is where we learned that billing is won or lost before the first invoice goes out. Here is how a subcontractor structures one that pays cleanly.

What a schedule of values actually is

A schedule of values breaks your total contract price into a list of line items, each with a dollar value, that together add up to the whole contract. Every month you bill the percentage complete on each line, and that is your progress invoice. The GC reviews line by line, applies holdback, and pays.

The SOV is the backbone of progress billing. It is also the thing the GC uses to judge whether your bill is reasonable. A clean, well-broken-down SOV signals a contractor who knows their scope. A vague one invites scrutiny on every draw.

How to break it down

The art is in the line items. Too few and you cannot bill accurately or defend your percentages. Too many and you drown in tracking. The right level maps to how the work actually gets installed and how you can prove progress.

Break by scope and by area, not by cost type. A line called "labour" and a line called "material" are useless for billing, because nobody can look at the building and tell you they are 60 percent done. Lines like "Level 2 metal framing," "Level 2 drywall hang," and "Level 2 tape and finish" can be verified by walking the floor.

Separate stored materials. Material delivered to site or to a bonded warehouse but not yet installed can often be billed before installation, but only if it is its own line. Bury it inside an installation line and you cannot claim it without overstating your install percentage.

Give general conditions and mobilization their own lines. Your early costs, site setup, hoisting, supervision, are real and billable early. They need dedicated lines so you can recover them in the first draws rather than smearing them across the work.

Match the GC's format where you can. If the GC issues a required SOV template or a set of cost codes, mirror it. A bill that reconciles to their system on the first pass gets approved faster than one they have to translate.

Front-load what you legitimately can

Cash flow on a construction job is brutal for the sub at the bottom of the chain. You carry labour and material for weeks before payment, minus holdback, and one slow draw can put a squeeze on payroll. A well-built SOV protects your cash flow by recovering early costs early.

This is legitimate when it reflects real cost, mobilization, general conditions, and stored materials genuinely incur cost up front, so billing them up front is fair. It becomes a problem, and a red flag to the GC, when you inflate early line items beyond their real value to pull cash forward on work you have not done. GCs watch for this, and overbilling early poisons the relationship for the rest of the job. Front-load the costs you actually incur, not the ones you wish you could.

Handle holdback inside the SOV

Every progress bill in Canada gets holdback deducted, and the SOV is where you track it running. In most provinces the statutory holdback is 10 percent, held back from each draw and released after substantial completion plus the lien period. Your SOV and your billing need to show holdback as a running deduction so you always know how much is accruing and when it comes due.

Getting holdback right on a schedule of values matters because it is often the difference between a job that made money and one that made money on paper but is still owed. If you want to see exactly what accrues on a given contract value, our construction holdback calculator runs the provincial rules, and our guide to holdback by province covers the differences. The rules trace back to provincial legislation such as the Alberta Prompt Payment and Construction Lien Act, which sets both the holdback and the payment clock.

Keep the SOV and the actuals connected

An SOV is a billing tool, but it is also a chance to see whether the job is making money. If your schedule of values line items line up with the cost codes you track labour against, then every month you can compare what you billed to what the work actually cost you. That is the start of real work-in-progress reporting: billings versus costs, line by line, so you know which parts of the job are earning and which are underwater while you can still do something about it.

That connection only exists if the field data comes back coded to the same structure. Crew time tracking tied to the same cost codes as your SOV is what turns a billing document into a profit-and-loss you can read mid-job. Without it, the SOV tells you what you billed and nothing about what you kept.

Our progress billing feature is built around a schedule of values that carries holdback and reconciles to your cost codes, and it sits alongside the rest of our construction management features. SubTrade starts at $299/month CAD with a 14-day free trial and no credit card required.

FAQ

What is a schedule of values in construction?

It is a breakdown of a contract's total price into line items, each with a dollar value, that add up to the full contract. Subcontractors bill the percentage complete on each line every month to create their progress invoice, and the general contractor reviews and pays against it.

How detailed should a subcontractor's schedule of values be?

Detailed enough that each line's percentage complete can be verified by looking at the work, usually broken by area and scope, but not so granular that tracking becomes a burden. Separate stored materials, mobilization, and general conditions into their own lines so you can bill them at the right time.

Can I front-load a schedule of values?

You can and should recover genuine early costs, mobilization, general conditions, and stored materials, in the early draws, because you actually incur them up front. Inflating line items beyond their real value to pull cash forward on unperformed work is overbilling, and GCs watch for it. Keep front-loading tied to real cost.

How does holdback work on a schedule of values?

Holdback, typically 10 percent in most Canadian provinces, is deducted from each progress draw and released after substantial completion plus the lien period. Your SOV should track holdback as a running deduction so you always know how much is accruing and when it becomes payable.

What is the difference between a schedule of values and a progress bill?

The schedule of values is the fixed breakdown of the contract into line items. The progress bill is the monthly application against it, showing the percentage complete and dollar amount earned on each line, less holdback. One is the structure, the other is the recurring invoice built on it.

Should my schedule of values match the general contractor's cost codes?

Where possible, yes. Mirroring the GC's required template or cost codes means your bill reconciles to their system on the first pass and gets approved faster. Aligning your SOV to the codes you track labour against also lets you compare billings to actual costs each month.