Part of the Ontario construction contracts guide for owners.
Ontario's prompt payment rules put owners on a fixed clock the moment a proper invoice lands, and the January 1, 2026 amendments to the Construction Act made that clock less forgiving. If your invoice review process still runs on "we'll get to it at month-end," it is now a liability.
How the prompt payment clock works
Prompt payment has applied in Ontario since October 1, 2019. The trigger is a proper invoice from the contractor. Contracts are deemed to have monthly progress payments unless the contract clearly sets out another structure, such as milestones.
Owners cannot make owner approval, a draft invoice review or consultant certification a precondition to the contractor delivering a proper invoice. Those steps can still be payment conditions, but they do not stop the clock from starting.
Once a proper invoice is received, the core deadlines are:
- Day 7: last day to give written notice that the invoice is deficient (new for 2026, see below).
- Day 14: last day to deliver a notice of non-payment for any amount you dispute, with all of your reasons.
- Day 28: payment of the undisputed amount is due.
Late payments carry interest at the greater of the Courts of Justice Act rate and any rate in the contract. Downstream, a contractor must pay its subcontractors within 7 days after it is paid by the owner.
What changed on January 1, 2026
Amendments from Bill 216 and Bill 60 took effect on January 1, 2026. Three matter most for owners on the payment side.
Invoices are deemed proper unless you object within 7 days
Under the new section 6.1(2), an invoice that does not strictly meet the requirements is deemed a proper invoice unless the owner gives written notice within 7 days of receipt. The notice must identify the deficiency and what is needed to fix it. Miss that window and the 28-day clock runs on an invoice you may not like.
The good news: the definition of a proper invoice was expanded to include information the owner reasonably requests for its accounts payable system, and the contractual payment entitlement on which the invoice is based. Owners should use that.
A deficiency notice is not a notice of non-payment
Flagging a defective invoice does not extend the 14-day deadline for a notice of non-payment. Where you dispute the amount, you may need both notices. If no timely notice of non-payment is given, the owner must pay the full invoice for that cycle and raise the dispute later as a set-off.
Adjudication got broader and longer-lived
Adjudication is Ontario's fast, interim dispute process, administered by the Ontario Dispute Adjudication for Construction Contracts (ODACC). The 2026 changes:
- Adjudication can be started up to 90 days after a contract is completed, abandoned or terminated, unless the parties agree otherwise.
- Scope now extends beyond payment to matters such as scope of work, change in contract price and extension of time, as set by regulation or agreed in the contract.
- Parties may use private adjudicators who are qualified by ODACC.
- The time to pay an adjudicator's determination increased from 10 to 15 days after it is communicated to the parties.
By default, the adjudicator's determination is due 30 days after the claimant delivers its documents. Determinations are binding on an interim basis and enforceable until a court, an arbitrator or a written agreement says otherwise. If a party does not pay, the other side may suspend work. A month is not long to assemble a defence from scratch.
What owners must set up in their invoice review process
- Date-stamp every invoice on receipt. Day 0 is when you receive it, not when it reaches the right desk. Use one intake address per project.
- Write your proper invoice requirements into the contract. List the supporting documents, the payment entitlement reference and the AP data you need.
- Run a day-5 completeness check. Leave room to issue a written deficiency notice before day 7.
- Get the consultant's or cost consultant's review by day 10. That leaves time to draft a notice of non-payment with every reason stated.
- Pay the undisputed portion by day 28. Withholding the whole invoice over a partial dispute is how owners end up in adjudication.
- Keep an adjudication-ready file. Change records, schedules and correspondence should be organized as you go.
- Track your deadlines. Our Ontario prompt payment calculator maps each date from the invoice receipt date.
On programs we have supported, the bottleneck is rarely the owner's finance team. It is consultant review that was scheduled around a monthly meeting instead of the statutory clock.
Transition rules matter: contracts and procurements that started before October 1, 2019 are outside the prompt payment regime, and some 2026 changes have their own transition provisions. Owners should confirm how the rules apply to a specific contract with their lawyer.
Frequently asked questions
How long does an owner have to pay a contractor in Ontario?
28 days after receiving a proper invoice. Any amount you dispute must be covered by a notice of non-payment delivered within 14 days, and the undisputed balance must still be paid.
Can an owner reject an invoice for missing information?
Yes, but only by written notice within 7 days of receipt that identifies the deficiency and what is needed to fix it. After that, the invoice is deemed proper.
How fast must an adjudicator's determination be paid?
Since January 1, 2026, within 15 days after the determination is communicated to the parties, up from 10 days.
The bottom line
Prompt payment is a process problem, not a legal one. Owners who build a 7-14-28 day review workflow into their contracts and teams pay on time, dispute cleanly and rarely see an adjudicator. If you want an independent check of your invoice review process, an owner's rep can set it up and run it.
Want a second set of eyes on your payment workflow before the next draw? Book a 30-minute call with Benjamin R. Consulting.
Sources: Glaholt Bowles LLP, Major Amendments to Ontario's Construction Act Coming January 1 (December 2025); Robins Appleby LLP, Key changes to Ontario's Construction Act introduced by Bill 216 and Bill 60 (2026); Ontario Bar Association, Ontario's Construction Act: Key 2026 Amendments (January 2026); Osler, Ontario Construction Act amendments now in effect (March 2026); Blakes, Ontario: New Bill 216 to Amend the Construction Act (November 2024); McCarthy Tetrault via Mondaq, Ontario Construction Act Changes: Adjudication (December 2024); McCarthy Tetrault, Six takeaways: Construction Act adjudication four years in review (December 2023); Gowling WLG, Getting ready for prompt payment in Ontario (May 2019); Government of Ontario, Construction Act, R.S.O. 1990, c. C.30. This article is general information, not financial or legal advice.