Practical guide
How to Handle Progress-Stage Payments to the Contractor
In extraordinary works the contractor is generally paid by progress stages: each SAL corresponds to a share of work done, an invoice, and a payment. The manager must not simply transfer the amount: they must check that the progress stage has been certified by the works supervisor, verify that the fund has enough coverage, make the payment with the correct transfer, and record everything in separate accounting. Orderly management of progress-stage payments protects the condominium from undue outlays and keeps the site under control. This guide sets out the steps.
Before every progress-stage payment
- SAL certified by the works supervisor and consistent with the work done
- Contractor's invoice linked to the matching SAL
- Fund coverage checked before authorizing the outflow
- Contractor's contribution compliance as per the contract
- Dedicated transfer with the correct description if the work is deductible
- Entry in the site ledger with gross amount and withholding
What a progress stage is
The progress stage, in Italian stato di avanzamento lavori or SAL, is the document certifying the share of work done at a given date. In a staged-payment contract, the contract provides that the contractor earns the right to payment as it reaches certain progress thresholds, for example on completing a phase or reaching a percentage of the works.
The SAL is prepared and certified by the works supervisor, who checks the match between what is invoiced and what is actually built. This technical check gives the manager the basis to authorize payment: without a certified SAL the payment has no justification and the condominium risks advancing money for work not yet done.
Check fund coverage before paying
Once the certified SAL and its invoice arrive, the manager must verify that the fund has the necessary money. If the fund installments were scheduled correctly against the payment schedule, the till should be sufficient. But defaulting owners can reduce the actual coverage.
The check is done on the site ledger, comparing the fund inflows actually collected with the amount to be paid. If coverage is not enough, reminders must be triggered and recovery from defaulters considered, bearing in mind that the contractor is still entitled to the full SAL payment: the difference must be covered from available funds.
Make the payment with the correct transfer
For works giving the right to a tax deduction, payment must be made by dedicated transfer, filled in with the description that lets the bank apply the withholding tax provided by Article 25 of Decree-Law 78 of 2010. An ordinary transfer, lacking the requirements, can compromise owners' right to the deduction.
The transfer must correctly state the condominium's tax code, the VAT number of the beneficiary contractor, and the legal reference of the relief. The bank withholds the tax and pays the net amount to the contractor; both the gross and the withholding must be recorded in the site ledger.
- Dedicated transfer with a description that triggers the withholding
- Condominium tax code as the payer
- Contractor's VAT number as the beneficiary
- Recording of the gross amount and the withholding retained
Record the payment in separate accounting
Every progress-stage payment must be recorded in the site's dedicated ledger and linked to the invoice and SAL that justify it. This way the ledger balance stays aligned: fund collected minus payments made, with the withholdings shown.
This traceability is what makes it possible to produce, at the end of the works, an orderly and verifiable separate report. It also lets you reconstruct at any time how much has already been paid to the contractor and how much remains against the total contract amount.
Track progress with software
Handling the sequence of SALs, invoices, coverage checks, and withholdings by hand is burdensome, especially on long sites. Management software lets you link each payment to the fund and the site, check coverage in real time, and keep the documentation of each progress stage.
With AmministraPro you can follow the site's progress, check how much of the fund has been collected before authorizing a payment, and record transfers and withholdings in the project ledger. The features are described on the /funzioni page and the available plans with their costs on the /prezzi page.
Frequently asked questions
Who certifies the progress stage?
The SAL is prepared and certified by the works supervisor, who checks the match between what the contractor invoices and the work actually done. This technical certification is the basis on which the manager authorizes payment: without a certified SAL the outlay has no justification.
Can the contractor demand payment even if some owners are in arrears?
Yes. The contractor is entitled to the full SAL payment regardless of the condominium's internal arrears. If the fund is not fully collected, the manager covers the difference from available funds and then recovers the shares from defaulters under Article 63 of the implementing provisions.
Why must the payment be made by dedicated transfer?
For deductible works, only the dedicated transfer lets the bank apply the withholding tax under Article 25 of Decree-Law 78 of 2010 and document the expense correctly for the relief. An ordinary transfer can cause owners to lose the right to the deduction.
Can I pay a SAL without recording it in separate accounting?
It is strongly discouraged. Recording every payment in the site ledger, linked to the invoice and SAL, keeps the balance aligned and lets you produce a verifiable separate report at the end of the works. Without this traceability it becomes hard to show the meeting that the fund was managed correctly.
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