A subcontractor application for payment is the monthly billing package you send the general contractor to collect for work put in place: a summary form showing the contract sum, approved change orders, work completed and materials stored to date, retainage, prior payments, and the current amount due, backed by a continuation sheet that breaks those totals down line by line against your schedule of values, plus the lien waivers, insurance certificate, and (on federally funded jobs) certified payroll that the GC needs before cutting a check. The forms most commonly used are the AIA G702 and G703 or the ConsensusDocs 710, though many larger GCs run their own templates inside a construction management platform.
What Goes on the Form Itself
Every template asks for the same core numbers, and every number has to reconcile with the others:
- Original contract sum, the base value of the subcontract.
- Net change orders, the total dollar value of all approved additions and deductions, which produces the current contract total.
- Work completed to date, cumulative through the current billing period, shown as both a dollar amount and a percentage against each line item of the schedule of values.
- Materials stored, the value of materials delivered and properly stored (on site or at an approved off-site location) that have not yet been installed. Stored materials generally require proof of insurance, evidence of ownership transfer to the owner, and sometimes photographs.
- Retainage, the percentage withheld from each progress payment as security against incomplete or defective work, typically between 5 and 10 percent of completed work.
- Previous payments received, the total of all prior certified payments on this contract.
- Current amount due, which is total completed and stored to date, minus retainage, minus previous payments.
The arithmetic is straightforward, but everything has to tie. If the SOV values a line item at $50,000 and you bill it 60 percent complete, the dollar figure on that line has to be exactly $30,000. A one-dollar mismatch between the continuation sheet and the cover sheet is enough to get the whole package returned.
The Schedule of Values Behind It
Every application traces back to the schedule of values, the line-by-line breakdown of your contract sum into individual work items with dollar amounts assigned to each. The SOV is set early in the project, usually before the first billing, and becomes the yardstick the GC’s project manager measures against every month. If it is poorly organized or does not track how the work actually progresses on site, you will argue over percentages in every cycle.
Break the scope into logical, measurable chunks. A single “rough plumbing — $180,000” line is too broad; splitting it into underground rough-in, above-grade rough-in, and testing and inspection gives the GC visible milestones to verify. Each line should correspond to work you can point to in the field and defend as done or defensibly in progress.
The pattern reviewers watch for is front-loading, meaning inflated values on early work items so the sub collects a disproportionate share of the contract sum before it has been earned. Front-loading eases cash flow in month one and creates a shortfall against the work still ahead. GCs and owners scrutinize SOVs for exactly this pattern, and an obviously front-loaded schedule can sour the relationship before any concrete is poured.
Which Form to Use
AIA G702 and G703
In commercial construction the most widely used forms are the AIA G702 (Application and Certificate for Payment) and the AIA G703 (Continuation Sheet). The G702 is the summary page carrying the contract sum, change orders, retainage, and the amount requested. It has a signature block for the contractor and a separate certification area for the architect, who reviews the application and certifies to the owner that the requested amount is due.1AIA Contract Documents. Instructions: G702-1992, Application and Certificate for Payment The G703 is the line-item detail; it breaks the contract sum into portions of work following the schedule of values, and the information on it must be consistent with the summary totals on the G702.2AIA Contract Documents. Instructions: G703-1992, Continuation Sheet If the numbers do not match, the application comes back.
For subcontractor-to-GC billing specifically, AIA publishes the G702S–2017, a variation designed for the contractor-subcontractor relationship. It follows the same structure but is tailored to the subcontract rather than the prime contract. Current versions can be purchased directly from AIA.
The standard G702 includes a notary block, but notarization is not legally required in most situations. Whether you actually need it depends on your contract and on what the GC or owner asks for. If the contract requires it, notarize; if nobody has asked, the block can usually stay blank.
ConsensusDocs 710
The ConsensusDocs 710 is the main alternative, developed specifically for progress payments on lump-sum subcontracts through a process involving contractors, owners, and design professionals rather than an architect-led drafting group.3ConsensusDocs. Subcontractor Payment Application Form for Lump Sum Projects It covers the same ground (work completed, stored materials, retention, approved change orders) and adds a certification that the subcontractor has paid its own sub-subcontractors and suppliers in compliance with applicable laws, which gives the GC additional protection against downstream lien claims.
Many larger GCs use their own proprietary templates inside project management software. The underlying data requirements are the same whichever format you fill out.
Documents You Attach
The form is the top sheet. The package around it is what actually gets you paid, and a missing attachment is one of the fastest ways to be sent back.
Lien Waivers
Lien waivers matter most to the GC and owner because they protect the property from future lien claims. Four types exist, and you will typically send two of them with each progress billing:
- Conditional waiver on progress payment, submitted with your current application. It releases lien rights for this billing period once the payment actually clears. If the check bounces, the waiver does not take effect.
- Unconditional waiver on progress payment, submitted for the previous billing period to confirm you received that earlier payment and to release lien rights for that work. This one is binding on execution.
- Conditional waiver on final payment, used with the final application and conditioned on receiving the last check.
- Unconditional waiver on final payment, submitted after the final check has cleared, releasing all remaining lien rights.
Many states prescribe specific statutory forms for lien waivers, and using the wrong format can make the waiver unenforceable. Check your state’s requirements rather than assuming a generic template will hold up.
Certificate of Insurance
Most subcontracts require you to carry general liability, workers’ compensation, and commercial auto coverage at minimum throughout the project. Include a current certificate of insurance showing that the policies are in force and meet the contract minimums. If the GC or owner is listed as an additional insured, the COI has to reflect that endorsement. An expired COI is a routine and entirely avoidable cause of payment delay.
Certified Payroll on Federal Projects
On projects receiving federal funding, the Davis-Bacon Act requires you to pay workers the locally prevailing wage rates and submit certified payroll records weekly.4U.S. Department of Labor. Fact Sheet 66: The Davis-Bacon and Related Acts The standard form is the WH-347, capturing each worker’s name, classification, hours worked each day, hourly wage rate, and deductions.5U.S. Department of Labor. Instructions For Completing Davis-Bacon and Related Acts Weekly Certified Payroll Form, WH-347 Every submission includes a signed Statement of Compliance certifying that every worker was paid at least the applicable prevailing wage.
Falling behind on certified payroll is a serious problem. Contract payments can be withheld to cover wage liabilities, and Davis-Bacon violations can lead to contract termination or debarment from future federal work for up to three years.4U.S. Department of Labor. Fact Sheet 66: The Davis-Bacon and Related Acts If your project has a Davis-Bacon wage determination, attach certified payroll to every pay application whether or not anyone specifically asks.
Preliminary Notice
Preliminary notice is not part of the pay application itself, but it belongs on this list because your lien rights depend on it. Many states require subcontractors to send a preliminary notice early in the project to preserve the right to file a mechanic’s lien. Deadlines vary: some states give 20 days from first furnishing labor or materials, others allow longer windows, and a few require no notice at all. Missing the deadline can permanently eliminate your strongest payment remedy. Check the state lien statute before your first day on site.
How and When to Submit
Your subcontract will spell out how and when to submit. Watch the billing deadline carefully. Most projects have a fixed cutoff each month, often between the 20th and 25th, and being one day late can push payment into the next cycle, a 30-day delay you imposed on yourself.
Many GCs now require submission through construction management platforms such as Procore or Textura. These systems timestamp the submission, route it through the approval chain, and let you see where the application sits. If there is no digital platform, use a method that creates a delivery record: certified mail or hand delivery with a signed receipt. Email is fine when the contract allows it; keep proof of transmission either way.
After submission, the project manager checks field progress against your claimed percentages, accounting verifies the math and documentation, and the approved amount is passed up to the owner for payment. On federal construction contracts, the prime contractor must pay you within 7 days of receiving payment from the government.6Acquisition.GOV. 48 CFR 52.232-27 – Prompt Payment for Construction Contracts State prompt payment statutes impose similar requirements on private projects, with timelines that range from about 7 days to 30 days or more depending on the state. These statutes typically carry interest penalties for late payment, which gives you leverage when a GC sits on an approved application.
Do not submit and forget. Follow up when the review period runs past what the contract allows, and if you get correction requests, turn them around the same day when you can. Every day a revised application sits on your desk is another day without payment.
Why Applications Get Rejected
GC project managers return applications rather than fix them. The common triggers are predictable:
- The math does not tie. The continuation sheet must add up to the summary totals down to the penny.
- Documentation is missing. Lien waivers, insurance, and certified payroll must be current and complete.
- Work in place is overstated. If you claim 75 percent complete and the field walk shows 50 percent, the entire application gets questioned, not just that line. Detailed, realistic SOV line items reduce this fight because there is less room to disagree about what “complete” means.
- Wrong form or format. If the contract calls for AIA documents and you send a custom spreadsheet, or the GC uses a digital platform and you email a PDF, expect a return.
- Stale information. Contract values that do not reflect recent change orders, or numbers that ignore backcharges the GC has already flagged, signal that you are not tracking the project.
Most experienced subs build in a day or two before the deadline for a final internal review of the complete package.
Retainage and the Final Application
Retainage of 5 to 10 percent is held back from every progress payment and accumulates until the project hits certain milestones. On a $500,000 subcontract with 10 percent retainage, you can have $50,000 sitting untouched by the time you finish. Getting it released is a separate process from monthly billing.
Retainage release typically requires substantial completion of your scope, clearance of all punch list items, submission of closeout documents (warranties, as-built drawings, operation and maintenance manuals), and a final lien waiver. On bonded projects you may also need a consent of surety. Federal projects require a final certified payroll submission. The GC will not release retainage until the owner releases it, and the owner will not release it until the conditions are satisfied.
Some states set specific timelines for retainage release after final acceptance, and prompt payment statutes often require the GC to pass retainage down promptly after receiving it from the owner. Retainage collection is where many subcontractors lose money by finishing the work, moving to the next job, and never following through on closeout paperwork. Treat it with the same discipline as monthly billings.
Your final payment application should account for the full remaining retainage plus any unbilled work. Attach an unconditional waiver on final payment (or a conditional one if the check has not arrived yet) and all required closeout documents. The GC will reconcile total billings against the final contract value at this point, so make sure your numbers account for every change order, including deductive changes and backcharges.
Overbilling Risk
Overstating work-in-place percentages or inflating material costs is not just a billing dispute. On private projects, intentional overbilling can support breach of contract claims and termination for cause, which carries far greater consequences than a returned application.
On federal projects the exposure is significantly larger. The False Claims Act makes it illegal to knowingly submit a false claim for payment to the federal government, and “knowingly” includes deliberate ignorance and reckless disregard for accuracy; specific intent to defraud is not required.7Office of the Law Revision Counsel. 31 USC 3729 – False Claims Penalties include three times the government’s actual damages plus civil fines per false claim that are adjusted annually for inflation. The Act also allows private whistleblowers to sue on the government’s behalf and collect 15 to 30 percent of the recovery, which means your own employees and sub-subcontractors have a financial incentive to report inflated billing.
The practical defense is honest self-assessment. Walk the work before you bill it, and if you are unsure whether a line item is 70 or 75 percent complete, bill the lower number. Adjusting upward next month is painless. Explaining why you overbilled is not.