Security of Payment Act SA: builder's guide to the SA SoP Act

TL;DR

South Australia’s Building and Construction Industry Security of Payment Act 2009 is the cash-flow enforcement tool for SA builders, subcontractors, and suppliers. It covers most construction contracts in SA, but explicitly excludes owner-occupier residential (where the client lives or intends to live in the premises). Serve a valid payment claim with the statutory endorsement on or after a reference date, and the respondent has 15 business days to pay in full or issue a payment schedule. If no schedule arrives, give notice within 20 business days of the due date, allow 5 business days for a late schedule, then lodge an adjudication application within 10 business days. Adjudicators determine within 10 business days of the response date. Since 1 May 2025, Crown contracts exceeding $4 million ex-GST are exempt from adjudication and suspension rights: contractors on those jobs must use contractual dispute resolution instead. Missing the 20-business-day notice window when no schedule is served is the most common reason SA adjudication applications fail.

In plain English

The Building and Construction Industry Security of Payment Act 2009 (SA) gives builders, subcontractors, and suppliers a fast-track right to recover unpaid progress payments without going to court. When a client or head contractor refuses to pay, or pays less than the amount claimed, the Act provides a process: serve a valid payment claim, wait for a payment schedule, and if payment is still withheld, apply for adjudication through an Authorised Nominating Authority (ANA).

The principle is “pay now, argue later.” An adjudicator’s determination is not a final ruling on the parties’ legal rights. Either party can pursue the underlying dispute through the courts after adjudication, but the losing party must pay the adjudicated amount first.

The Act was modelled on the NSW Act and shares its core structure: payment claim, payment schedule, adjudication. The main SA-specific features are the residential exclusion framing, the strict 15-business-day payment schedule window, and the 2025 Crown exemption.

What it requires

Who is covered

The Act applies to any person carrying out construction work or supplying related goods and services under a construction contract in South Australia (verified 2026-05-09, SA Small Business Commission, Security of Payment Act). This includes:

Head contractors claiming from principals (owners, developers)
Subcontractors claiming from head contractors
Suppliers of related goods and services connected to construction work

Construction work includes building and structural works, civil infrastructure, site preparation, earthworks, and professional services such as architecture, engineering, and surveying (verified 2026-05-09, Procore AU, Security of Payments Act SA).

Residential exclusion (s 7)

The Act does not apply to domestic building work where a resident owner is party to the contract and the contract relates to premises where they reside or intend to reside (verified 2026-05-09, Adjudicate Today, SA Definitions). In practice this means:

Owner-occupier residential contracts are excluded. If a homeowner contracts directly with a builder to renovate or build the home they plan to live in, the Act does not apply to that head contract.
Subcontractors are still covered. A subcontractor engaged by the builder on an owner-occupier residential project can use the Act to claim against the head contractor.
Investment and development projects are covered. Contracts where the contracting party does not live or intend to live in the premises fall within the Act.

2025 Crown exemption (Regulation 7, from 1 May 2025)

From 1 May 2025, the Building and Construction Industry Security of Payment (Exemption) Amendment Regulations 2025 (SA) exempt “prescribed contracts” from key Act provisions. A prescribed contract is a contract between the Crown and another party where the total amount payable exceeds $4 million (excluding GST) over the term of the contract. Extension periods are excluded from this calculation (verified 2026-05-09, TG Law, SA SOPA Update: The Crown now exempt from the Act).

Under a prescribed Crown contract, the contractor cannot:

Rely on automatic liability arising from the Crown’s failure to provide a payment schedule
Apply for adjudication
Suspend works under the Act

The exemption has retrospective effect: it applies regardless of when the Crown contract was entered into, including contracts executed before 1 May 2025. Subcontractors retain full Act access against contractors, even under prescribed Crown contracts (verified 2026-05-09, Cowell Clarke, Exclusions to the Security of Payment regime now apply).

Step 1: Payment claim (s 13)

A claimant serves a written payment claim on the respondent on or after a reference date. The reference date is the date specified in the contract for making progress claims, or the last day of each calendar month if the contract is silent (s 8(2), verified 2026-05-09, Adjudicate Today, SA Definitions). Only one payment claim may be made per reference date.

A valid payment claim must:

Requirement	Detail
Written form	Must be in writing
Work description	Identify the construction work, goods, or services claimed
Amount	State the claimed amount
Statutory endorsement	Include a statement that it is “a payment claim made under the Building and Construction Industry Security of Payment Act 2009 (SA)” or words of similar effect
Correct party identification	Identify the correct legal names of the claimant and the respondent

Claims must be served within 6 months of the date the work was last performed or the goods or services were last supplied (verified 2026-05-09, DW Fox Tucker, Navigating the SA Security of Payment Act). Earlier unpaid work can be included in the same claim provided at least some work was performed within the 6-month window.

There is no mandatory supporting statement requirement for head contractors under the SA Act (unlike NSW). Some contracts may require supporting documentation, but the Act itself does not mandate it.

Step 2: Payment schedule (s 14)

The respondent must respond within the earlier of the timeframe stated in the contract, or 15 business days of receiving the payment claim (verified 2026-05-09, Procore AU, Security of Payments Act SA). The response must be a written payment schedule that:

Identifies the payment claim it relates to
States the scheduled amount the respondent proposes to pay (which may be nil)
If less than claimed, gives reasons for the withholding

If no payment schedule is served within the 15-business-day window, the full claimed amount becomes due and payable on the due date.

Payment due date: Either the date specified in the contract, or 15 business days after the payment claim is served if the contract is silent (s 11(1), verified 2026-05-09, Adjudicate Today, SA Definitions).

Once a payment schedule is issued, the respondent cannot raise new withholding reasons in adjudication that were not included in the schedule.

Step 3: Adjudication application (s 17)

If the respondent serves a payment schedule for less than the claimed amount, or fails to pay by the due date, the claimant can apply for adjudication through an ANA. The application must be in writing, served on the respondent, and include the relevant fee.

Application windows by scenario:

Scenario	What to do	Application window
Respondent served a payment schedule below the claimed amount	Apply to ANA directly	Within 15 business days of receiving the payment schedule
Respondent served no payment schedule, payment not made by due date	Serve a notice of intention to apply for adjudication on the respondent within 20 business days of the due date; allow 5 business days for a late schedule	Within 10 business days after the 5-day notice period expires
Respondent served a payment schedule but did not pay the scheduled amount	Apply to ANA	Within 20 business days of the due date for the scheduled amount

Missing the 20-business-day notice window in the “no schedule” scenario extinguishes the right to adjudicate for that reference date. The notice must be in writing and must reference the Act.

ANAs operating in SA include the Australian Solutions Centre, Adjudicate Today, and Resolution Institute (verified 2026-05-09, SA Small Business Commission, Security of Payment Act).

Step 4: Adjudication response (s 20)

Once an adjudicator is appointed and the claimant’s application is served on the respondent, the respondent has the later of:

5 business days after receiving the adjudication application, or
2 business days after receiving notice of the adjudicator’s acceptance

to lodge an adjudication response (verified 2026-05-09, Sam Blackman Barrister, Overview of the SA Security of Payments Act). The respondent may only rely on reasons that were included in the original payment schedule. No new withholding reasons can be raised in the response.

If the respondent did not serve a payment schedule at all, they cannot lodge an adjudication response.

Step 5: Adjudicator’s determination (ss 21-22)

The adjudicator must make their determination within 10 business days of the date the adjudication response was (or was required to be) lodged, unless the parties agree in writing to extend that period (verified 2026-05-09, Sam Blackman Barrister, Overview of the SA Security of Payments Act).

The respondent must pay the adjudicated amount within 5 business days of the determination, or by the later date specified by the adjudicator.

If the respondent does not pay, the claimant may obtain an adjudication certificate from the ANA and register it as a judgment debt in a court of competent jurisdiction.

An adjudication determination is not a final decision on the parties’ legal rights. Either party may pursue the underlying dispute through the courts, but the paying party must first pay the adjudicated amount.

Suspension of works (s 24)

A claimant may suspend construction work or the supply of goods and services by serving written notice on the respondent at least 2 clear business days before the suspension. The claimant is not liable for any delay or loss caused by the suspension if they were entitled to exercise the right (verified 2026-05-09, Procore AU, Security of Payments Act SA).

Note: the suspension right does not apply to contractors on prescribed Crown contracts (contracts exceeding $4 million ex-GST with the Crown) from 1 May 2025.

What it doesn’t cover

Owner-occupier residential work: Contracts where the party receiving the benefit of the work resides or intends to reside in the premises are excluded from the Act.
Crown contracts over $4 million (from 1 May 2025): Contractors cannot use adjudication or suspension rights on prescribed Crown contracts. Subcontractors are still protected.
Employees: Employment relationships are outside the Act. The Act covers contractors and subcontractors, not workers engaged under an employment contract.
Loan agreements, guarantees, and insurance: Contracts forming part of a loan agreement, guarantee, or insurance arrangement with a recognised financial institution are excluded.
Contracts outside SA: The Act applies only to construction contracts where the work is performed in South Australia.
Pay-when-paid clauses: Provisions making payment contingent on the head contractor receiving funds from upstream have no effect under the Act.

Practical implications

For builders and subcontractors

The Act is a cash-flow tool. Use it when a client or head contractor:

Fails to serve a payment schedule within 15 business days of receiving a valid payment claim
Issues a payment schedule for substantially less than the value of work done
Fails to pay the scheduled or adjudicated amount by the due date

Always mark the payment claim with the statutory endorsement (“This is a payment claim made under the Building and Construction Industry Security of Payment Act 2009 (SA)”). Without it, the claim does not attract the Act’s protections.

Set calendar alerts for the 15-business-day payment schedule window and, if no schedule arrives, the 20-business-day deadline to serve the notice of intention to apply for adjudication. Missing the notice window is the most common fatal error in SA adjudication applications.

Check whether the contract specifies reference dates and payment terms. If it does, those dates govern. If it is silent, the reference date defaults to the last day of each calendar month, and the payment due date defaults to 15 business days after the claim.

Business days in SA exclude Saturdays, Sundays, public holidays, 27 to 31 December, and any statewide industry shutdown days (verified 2026-05-09, Adjudicate Today, SA Definitions).

For principals and clients

If you receive a payment claim and the amount is disputed, serve a written payment schedule within 15 business days identifying exactly which amounts are withheld and why. Failing to serve a schedule in time makes the full claimed amount due and payable regardless of any dispute about quality or completeness.

Every reason for withholding payment must be stated in the payment schedule. Reasons not stated in the schedule cannot be raised later in adjudication.

For Crown agencies

From 1 May 2025, contracts with the Crown exceeding $4 million ex-GST are outside the adjudication process. Contractors must rely on the dispute resolution provisions in the contract itself. Subcontractors engaged by the contractor retain full Act access for their claims against the contractor.

Source link

Building and Construction Industry Security of Payment Act 2009 (SA) on SA Legislation.

SA Small Business Commission, Security of Payment Act information (verified 2026-05-09).

Consumer and Business Services SA, South Australia’s building and construction industry changes (verified 2026-05-09).

References

Building and Construction Industry Security of Payment Act 2009 (SA) (verified 2026-05-09)
Building and Construction Industry Security of Payment (Exemption) Amendment Regulations 2025 (SA) (Crown exemption, from 1 May 2025) (verified 2026-05-09)
SA Small Business Commission, Security of Payment Act (verified 2026-05-09)
Adjudicate Today, SA Security of Payment 2026 (verified 2026-05-09)
Adjudicate Today, SA Security of Payment Definitions (verified 2026-05-09)
DW Fox Tucker, Navigating the Building and Construction Industry Security of Payment Act 2009 (SA) (verified 2026-05-09)
Procore AU, Security of Payments Act SA: What Contractors Need to Know (verified 2026-05-09)
Sam Blackman Barrister, Overview of the Security of Payments Act (SA) (verified 2026-05-09)
TG Law, SA SOPA Update: The Crown now exempt from the Act (verified 2026-05-09)
Cowell Clarke, Exclusions to the Security of Payment regime now apply: Crown contracts exceeding $4m (verified 2026-05-09)
Piper Alderman, South Australian Construction Industry: Rising Costs and Payment Difficulties (verified 2026-05-09)
Consumer and Business Services SA, South Australia’s building and construction industry changes (verified 2026-05-09)