Vermont prompt payment

Who and what this applies to

Owners, contractors and subcontractors on Vermont construction contracts, including state and local owners. Excludes a natural person's purchase of materials for work they perform on their own real property.

Thresholds and scope

Written or oral construction agreements; owner default payment timing can be changed by agreement, while downstream protections expressly override contrary agreements.

The rules

• Owners pay according to the construction contract. Unless otherwise agreed, interim/final invoices are due 20 days after the billing period ends or invoice delivery, whichever is later. Source
• Contractors/subcontractors must pass along the full or proportional payment for compliant work seven days after receipt of payment or the subcontractor's invoice, whichever is later. Before entering a subcontract, disclose the owner's payment due date; failure triggers the statutory default treatment. Source
• An invoice recipient must identify documentation errors in writing within ten working days or waive them. Source
• Good-faith disputed sums may be withheld. Wrongful withholding found in arbitration/litigation carries a 1% monthly penalty, plus substantially prevailing-party attorney fees and expenses. Source
• The chapter includes state/local owners and construction/design services. Source
• The chapter excludes material purchases by a natural person performing work on their own real property. Source

Deadlines

Owner default: 20 days after later billing-period end/invoice delivery. Downstream: seven days after later payment/invoice receipt. Invoice-error notice: ten working days.

Primary sources

• 04002
• 04003
• 04004
• 04007
• 04001
• 04009

Sources reviewed 2026-09-30. This guide covers the projects and rules stated above.

Back to Vermont contractor law · Prompt Payment topic guide.