Construction Retainage Calculator
Enter the contract sum, approved change orders, completed work, stored materials, retainage rates, and prior payments to estimate the current payment due on a construction pay application.
Current payment due$13,500.00
- Adjusted contract sum
- $105,000.00
- Total completed and stored
- $55,000.00
- Retainage on completed work
- $5,000.00
- Retainage on stored materials
- $500.00
- Total retainage
- $5,500.00
- Total earned less retainage
- $49,500.00
- Balance to finish including retainage
- $55,500.00
- Contract completion
- 52.38%
Retainage breakdown
| Basis | Amount | Rate | Retainage |
|---|---|---|---|
| Completed work | $50,000.00 | 10% | $5,000.00 |
| Stored materials | $5,000.00 | 10% | $500.00 |
Uses cumulative completed work, stored materials, retainage, and prior certified payments.
How to use this calculator
- Enter the original contract amount and the net total of approved change orders.
- Enter cumulative completed work and approved stored materials through this billing period.
- Set the retainage rate for completed work and for stored materials.
- Enter payments previously certified, then read the current payment due and balance to finish.
How construction retainage is calculated
Retainage is the portion of earned contract value held back from a progress payment. On a pay application, the arithmetic usually starts with the adjusted contract sum, then compares the value earned to date with prior certified payments. This calculator separates completed work from stored materials because contracts often treat those two bases differently.
The core formulas are:
A = C + O
G = W + M
R = W * (rW / 100) + M * (rM / 100)
N = G - R
D = N - P
B = A - N
Q = G / A * 100
- A is the adjusted contract sum: original contract amount plus approved change orders.
- G is total completed and stored: completed work to date plus stored materials to date.
- R is total retainage on completed work and stored materials.
- N is total earned less retainage.
- D is the current payment due after subtracting previous payments certified.
- B is the balance to finish including retainage.
- Q is the contract completion percentage.
What moves the payment due
The largest drivers are the cumulative value of completed work, the stored materials entered for the period, the retainage rates, and prior certified payments. A higher retainage rate lowers the current payment and increases the amount held for later release. A large previous payment can make the current payment negative, which should be read as a credit or prior overpayment rather than changed to zero.
Approved change orders matter because they change the denominator for completion and the remaining balance. A deduction can make the adjusted contract sum too small for the work reported to date, so the calculator warns when completed work plus stored materials exceed the adjusted contract sum.
What this calculator leaves out
This tool only estimates payment arithmetic. It does not decide whether retainage is allowed, capped, exempt, or due for release under a contract or local law. It also leaves out taxes, disputed work, back charges, liquidated damages, financing costs, stored-material documentation rules, and other adjustments that can appear on an actual certificate for payment.
Worked example
Suppose the original contract amount is $100,000 and approved change orders add $5,000, so the adjusted contract sum is $105,000. Completed work to date is $50,000 and stored materials are $5,000, for total completed and stored of $55,000.
At 10% retainage on both completed work and stored materials, retainage is $5,000 on work and $500 on materials. Total retainage is $5,500, so total earned less retainage is $49,500. If previous payments certified are $36,000, the current payment due is $13,500. The balance to finish including retainage is $55,500, and contract completion is about 52.38%.
Common questions
How is construction retainage calculated?
Retainage is usually calculated by multiplying the earned value subject to retainage by the retainage rate. This calculator applies one rate to completed work and a separate rate to stored materials, then adds those amounts together.
How do I calculate the current payment due on a pay application?
Add completed work and stored materials to get the gross earned amount, subtract retainage to get total earned less retainage, then subtract previous payments certified. The result is the current payment due for this application.
Is retainage applied to stored materials?
It depends on the contract and project rules. Some pay applications apply the same retainage rate to stored materials, some apply a lower rate, and some exempt stored materials. Use zero for the stored-materials rate when they are not subject to retainage.
What does balance to finish including retainage mean?
It is the adjusted contract sum minus total earned less retainage. In practical terms, it is the unpaid contract value still left after recognizing the earned amount that has not been withheld.
How do change orders affect a retainage calculation?
Approved change orders increase or decrease the adjusted contract sum. That affects the balance to finish and the completion percentage, even when the retainage rate itself does not change.
How does this relate to an AIA G702 pay application?
The calculator follows the same general flow used on many progress-payment forms: adjusted contract sum, total completed and stored, retainage, total earned less retainage, prior certificates, current payment due, and balance to finish. It is not a substitute for the actual contract form or certification process.