Are deposits and milestone payments included in PTRS?

Quick answer

It depends on the timing of payment relative to supply. A deposit paid before supply is generally not reportable, while a milestone payment can be reportable where payment can occur at least one calendar day after the relevant supply.

What does this mean?

A single contract can contain several separate payment arrangements, and each needs to be classified on its own. The Regulator's worked example shows an upfront deposit paid before supply as not reportable. Milestones already prepaid by that deposit are also not reportable. Later milestone payments are trade credit arrangements where payment can be made at least one calendar day after completion of the relevant phase.

Practical point

Do not classify an entire project or contract as one transaction. Deposits, milestone payments and other payment obligations may have different PTRS treatment even when they arise under the same agreement.

Other ways people ask this

• Do deposits need to be included in PTRS?
• Are milestone or progress payments reportable?
• Does an upfront payment count as trade credit?
• How are staged payments under a contract treated for PTRS?

Official sources

• Payment Times Reporting Guidance Materials
  Agreements with multiple arrangements
  Paragraph: 113 · Examples: 23, 24 · Page: 32-33

Related guidance

• What is a trade credit arrangement?
• What payments can be excluded from PTRS?
• What is a partial payment for PTRS?

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