Types of trust accounts | Queensland Building and Construction Commission

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There are two types of trust accounts—each protecting different contractual payment amounts:

  • project trust accounts 
  • retention trust accounts.

Project trust accounts

A project trust is an account through which project funds are received and paid – more specifically: 

  • the project owner or developer (contracting party) makes payments to the contracted party (head contractor) for work completed in accordance with the contract
  • the head contractor pays all subcontractors from this account 
  • the head contractor pays themselves from this account.

For more detailed information on operating a project trust account, refer to the guide below.

Trustee guide—project trusts (PDF, 2MB)

Retention trust accounts

A retention trust account is an account where ‘eligible’ cash retention amounts withheld from contractors are held until due to be paid.

Each trustee only requires ONE retention trust account. This one account may hold cash retention amounts across multiple projects. However, if they prefer, a trustee may have multiple retention trust accounts.

For more detailed information on operating a retention trust account, refer to the guide below.

Trustee guide—retention trusts (PDF, 1MB)

FAQs

Parties engaged by a head contractor to carry out ‘protected work’ or ‘related services’ must be paid from the head contractor’s project trust account (if they are required to have one). 

Protected work includes a broad range of building and construction activities – this includes the prefabrication of complete buildings or components that form part of a building (e.g., modules and structural components), whether carried out on-site or off-site. Related services include certain design, advisory and testing services. 

Parties that are only engaged to supply goods/materials such as windows, doors, cabinetry, furniture or other fixtures for example, are not to be paid from a project trust account. 

The online trust account tool provides guidance on who can and can’t be paid from a project trust account.
 

It depends on what type of work the consultant is engaged to carry out (whether or not it constitutes ‘protected work’ or ‘related services’) and whether or not they are engaged by the head contractor for a project trust contract. 

The online trust account tool provides guidance on who can and can’t be paid from a project trust account.
 

Not necessarily. Only those subcontractors that qualify as beneficiaries may be paid from a project trust account. Beneficiaries are subcontractors engaged to carry out ‘protected work’ or ‘related services’. If you are uncertain about whether a party is to be paid from a project trust account, you can use the trust account online tool for guidance.

Additionally, each eligible contract must have its own project trust account. A trustee is not permitted to combine multiple project trusts into a single project trust account.
 

Yes. If they are carrying out protected work or related services under a subcontract for a contract that requires a project trust, they must be paid from the project trust account regardless of the value of their subcontract.


Last reviewed: 10 Sep 2021 Last published: 10 Sep 2021
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