Two states can take the money off you. Three treat it as an offence and leave the contract standing. And South Australia does something different again, which may be the sharpest of the lot.

In all six Australian states, residential building legislation says the same thing about variations. The change has to be recorded in writing, priced, and agreed by the owner before the work is carried out. Not afterwards, and not at the next progress claim.

That much is universal. What follows a failure to do it is not, and the differences are larger than most builders expect.

In Victoria and New South Wales the legislation can strip your entitlement to the money. In Queensland, Western Australia and Tasmania it does close to the opposite, expressly preserving the contract while making the failure itself an offence. South Australia sits in neither camp. It uses a mechanism the others do not.

Builders working across borders routinely assume the rule they know at home travels with them. The obligation does. The penalty does not.

What counts as a variation

A variation is any change to the work described in the signed contract, including the plans and specifications that form part of it. Adding a window is a variation. Moving a wall is a variation. Substituting a specified product for a different one is a variation. So is deleting work.

The trigger is the departure from the contracted scope, not the size of the change or whether anyone is charging for it. A variation that reduces the price is still a variation. Whether you can then be paid for it depends on what the contract actually permits and, above that, on what the legislation in your state requires.

The point of no return is when the work starts, not when the invoice goes out

This is the part that costs builders money, and it is a sequencing failure rather than a pricing failure.

The common pattern is not a builder who forgets to charge. It is a builder who agrees to a change on site on a Tuesday, starts it on the Wednesday because the trade is there and the client seemed happy, and produces the paperwork on the Friday. By Friday the work exists. The conversation has stopped being an agreement and become a negotiation, and the builder is negotiating from behind.

Tasmania puts that instruction into the statute as bluntly as any jurisdiction manages. A building contractor must ensure that no work to which a proposed variation relates is performed until the variation document has been signed by both the contractor and the owner, where the variation is an addition to the contracted work or is sought by the owner.

Nobody loses a variation because they priced it wrong. They lose it because the concrete went in before the paper did.

What the document has to say

Queensland and Tasmania are the two most prescriptive on contents, and between them they make a reasonable working template for a builder anywhere.

Under Schedule 1B of the Queensland Building and Construction Commission Act 1991, the document must be readily legible. It must describe the variation. It must state the date of the request. If the variation will delay the work, it must state the contractor’s reasonable estimate of that delay. It must state the change to the contract price, or the method for calculating that change. And if the price changes, it must state when the increase is to be paid or the decrease credited.

Tasmania asks for much the same and adds two things worth borrowing. Where the variation was sought by the contractor rather than the owner, the document must state the reason for it. And where the contract provides for progress payments, the document must make appropriate provision for payments to reflect any change to the contract price caused by the variation.

The Queensland timing rule is the tightest of the six. Before the variation work starts, the contractor must present the variation to the owner in writing and the owner must agree in writing. The contractor must then give the owner a copy before the first of two things happens. The variation work starts, or five business days pass from the day both parties agreed to it. There is one exception, where the work must be carried out urgently and it is not reasonably practicable to produce a written copy first.

Two further Queensland rules travel well as habits. A contractor cannot require payment for a variation before the variation work has started. And where a variation changes the value of the project, amending the home warranty cover is the contractor’s responsibility, not the owner’s.

Meet that combined standard and you have satisfied the substance of what all six states are asking for, even where the local wording differs.

Group one. Victoria and New South Wales: it is money you cannot recover

This is the harsh end of the spectrum, and it is worth reading slowly.

Victoria

Under the Domestic Building Contracts Act 1995, section 37 covers variations the builder wants and section 38 covers variations the building owner asks for. Section 38 sets out a notice procedure the builder must follow before carrying out the work, including telling the owner what the variation will cost and what it will do to the completion date.

Section 38(6) then says a builder is not entitled to recover any money in respect of a variation asked for by a building owner unless the builder has complied with the section, or the Victorian Civil and Administrative Tribunal is satisfied of two things. That there are exceptional circumstances, or that the builder would suffer significant or exceptional hardship if the bar applied. And that allowing recovery would not be unfair to the building owner.

Where the Tribunal is satisfied, section 38(7) allows recovery of the cost of carrying out the variation plus a reasonable profit. That relief is discretionary and requires a tribunal application, which costs time and money on a sum you had already earned.

The High Court closed the obvious workaround in Mann v Paterson Constructions Pty Ltd in 2019, holding that a builder could not recover on a restitution basis for variations that did not comply with the section.

One change is coming. The Domestic Building Contracts Amendment Act 2025 amalgamates the separate section 37 and section 38 regimes into a single variation section, scheduled to commence on 1 December 2026 unless proclaimed earlier, and applying to contracts entered into on or after commencement. The recovery bar and the tribunal relief pathway survive the change. Contracts signed before commencement stay under the current sections.

Victoria has separately introduced a proposed criminal offence for undocumented variations. That measure was introduced in June 2026 and is not law at the time of writing.

New South Wales

New South Wales reaches a similar destination by a different route, through the enforceability of the contract itself rather than a variation specific bar.

The Home Building Act 1989 requires residential building contracts to be in writing, signed, and to contain a sufficient description of the work, with the detailed requirements differing depending on whether the contract price exceeds $20,000 under sections 7 and 7AAA. Section 7E requires that variations likewise be in writing and signed by or on behalf of each party.

Section 10 supplies the consequence. A person who contracts to do residential building work in contravention of those requirements is not entitled to damages, and is not entitled to enforce any other remedy in respect of a breach of the contract by the other party. The contract is unenforceable by the person who contracted to do the work.

The NSW Court of Appeal confirmed in Wright v Foresight Constructions in 2011 that an oral variation of a residential building contract is a contract not in writing, and therefore falls within that provision.

One asymmetry is worth knowing. Section 10 removes the builder’s ability to enforce. It does not remove the builder’s liability for breaches the builder has committed. The bar runs one way.

Whether a restitution claim survives in New South Wales after Mann v Paterson is less settled than the Victorian position, and commentary differs. That uncertainty is itself the argument for getting the paperwork right rather than planning to litigate the point.

Group two. Queensland, Western Australia and Tasmania: an offence, and a fight you still have to win

All three take the opposite approach on consequences, and it is regularly misread as leniency.

Section 44 of Schedule 1B provides that unless a contrary intention appears in the Queensland Act, a failure by a building contractor to comply with a requirement in relation to a domestic building contract does not make the contract illegal, void or unenforceable. Section 27 of the Home Building Contracts Act 1991 does the same work in Western Australia, providing that a contract or a provision is not illegal, void or unenforceable only because a requirement of that Act is not complied with.

What replaces the bar is a penalty, and the size of it varies a great deal. In Queensland the maximum for a defective variation document is 20 penalty units. In Western Australia the penalty attaching to the variation requirements is $500. In Tasmania the equivalent obligations carry up to 300 penalty units for a body corporate and 100 for an individual, which makes Tasmania far the most heavily penalised of the three on paper.

Tasmania also sequences the paperwork most explicitly. The contractor must sign the variation document and take all reasonable steps to have the owner sign it, and must give the owner a copy within five business days of the variation being agreed. Where the contractor has taken all reasonable steps but the owner simply will not sign, the Act allows a copy signed by the contractor alone to satisfy that obligation.

Western Australia is the only one of the six with defined exceptions to the writing requirement. It does not apply to a variation made necessary by a written direction lawfully given by a person acting under a written law, or by circumstances that could not reasonably have been foreseen by the builder when the contract was entered into. Both are conditional on the builder giving the owner a statement of the reason and the cost within 10 working days. And the Act says expressly that the second exception does not let a builder vary a contract by reason only of an increase in the cost of labour or materials.

A separate limit applies in Western Australia. The Act only reaches home building work contracts within prescribed monetary limits, which currently excludes contracts at or above $500,000 altogether.

None of this makes the three states the soft option. A preserved contract is not a paid invoice. Without a compliant document you still have to prove what was agreed, what it was worth, and that the owner accepted it, against a client who now has every reason to remember it differently. That is an evidentiary fight you enter having discarded the one document designed to end it, and penalties and demerit points attach to the licence rather than to the job, so they follow you to renewal.

Group three. South Australia: the clock that does not start

South Australia is the one almost nobody writing for builders explains, and it is the most interesting of the six.

It has no separate variation section. It does not need one. The Building Work Contractors Act 1995 defines a domestic building work contract to include any variation of such a contract, so every formal requirement that applies to the contract applies to each variation of it as well.

Those requirements sit in section 28. The contract must be in writing. It must set out in full all the contractual terms. It must be signed by the contractor and the building owner. The owner must be given a copy as soon as reasonably practicable after signing, together with the prescribed notice. And the copy must be readily legible.

A failure to comply with any of them is an offence. The maximum penalty is $50,000 for a natural person and $250,000 for a body corporate, with an expiation fee of $5,000. Those figures were increased recently, taking effect in January 2026, so any guidance written before then understates them.

The fine is not the part that should worry a builder.

A building owner in South Australia can terminate a domestic building work contract by written notice before what the Act calls the prescribed time. Ordinarily that is the end of five clear business days after the contract is made. But where there has been a failure to comply with the formal requirements, the prescribed time becomes the time of completion of the building work.

An undocumented variation in South Australia does not just risk a fine. It can keep the owner’s right to walk away from the whole contract alive until the day the job finishes.

If the owner does terminate, the Magistrates Court can order repayment of what the owner has paid, and can order payment to the contractor for materials supplied and work performed. So it is not automatic ruin. But the exposure is structural rather than monetary, and it sits open for the length of the build.

Division 1 does not apply to minor domestic building work, which is defined by a sum set in the regulations. That figure rose from $12,000 to $20,000 on 10 November 2025.

Where the differences bite

Terminology does not carry across borders, and a variation process built for one state will not automatically satisfy another. If you work across state lines, check the requirement against the regulator in each state rather than assuming your standard form travels.

Thresholds differ too. Tasmania excludes work under a contract price of $20,000. South Australia excludes minor domestic building work below $20,000. New South Wales sets different contract requirements either side of $20,000. Western Australia applies only between prescribed limits and drops out entirely at $500,000.

This piece covers the six states. The Australian Capital Territory and the Northern Territory each run their own requirements and are not covered here.

What a defensible variation record actually contains

The statutory minimum and a record that survives scrutiny are not quite the same document. A record that holds up contains the following.

•   A description of the change specific enough that someone who was not on site could price it

•   The date the change was requested, and by whom

•   Where you initiated the change, the reason for it

•   The price, or the stated method for calculating the price

•   The effect on the completion date, expressed as a reasonable estimate rather than left blank

•   When the increase is payable, or when the credit applies, and how it lands in the progress payment schedule

•   The client’s agreement, dated, and captured before work starts

•   Photographs of the affected area before the change is carried out

That last item is the one most often skipped and most often decisive once it reaches a tribunal, because it fixes the condition of the work at the moment the change was agreed.

None of this is complicated. It is a five minute task that gets skipped under time pressure, which is precisely why it belongs in a system rather than in someone’s intention. These are the habits that hold up under scrutiny, and the builders who run them do not think of them as paperwork.

The practical position

Variations are not the enemy. On most residential jobs they are unavoidable and often they are exactly what the client wants. The problem is never the change itself.

The problem is that a change agreed verbally and built immediately converts a clean entitlement into something you have to fight for. In two states it can end the claim outright. In three it costs you a fine and a much harder argument. In one it hands your client a right to walk away that should have closed in the first week.

Every variation carried out before the document exists is money already spent that may never be recovered, which lands directly on the cash position of the job while the job is still running.

It is also worth saying to clients directly, because the requirement is written into the legislation as a consumer protection rather than as red tape. A builder who produces a variation document before starting work is giving the homeowner the price and the delay before they commit, which is precisely what the law intends. The operator to be wary of is the one who says the paperwork can be sorted out later.

The discipline is not more paperwork. It is one rule, applied without exception. No variation work starts until the document is signed.

THE GOOD BUILDER TAKE

The instinct that costs the money is a good one. A trade is on site, the client wants the change, and holding the job up over a form feels like poor service.

Reverse the framing. Producing the document before the work is the service, because it is the only version where the client knows the cost and you keep the entitlement. Stopping for five minutes is cheaper than every alternative, in all six states, for three different reasons.

Frequently asked questions

Sources: Queensland Building and Construction Commission Act 1991 (Qld) Schedule 1B ss 40, 41 and 44, and Queensland Building and Construction Commission guidance on contract changes and variations. Domestic Building Contracts Act 1995 (Vic) ss 37, 38 and 39, and Domestic Building Contracts Amendment Act 2025 (Vic). Mann v Paterson Constructions Pty Ltd [2019] HCA 32. Home Building Act 1989 (NSW) ss 7, 7AAA, 7E and 10. Wright v Foresight Constructions Pty Ltd, NSW Court of Appeal, 2011. Home Building Contracts Act 1991 (WA) ss 3, 7, 8, 17 and 27, and Home Building Contracts Regulations 1992 (WA). Residential Building Work Contracts and Dispute Resolution Act 2016 (Tas) ss 4, 9, 17, 18, 19 and 20. Building Work Contractors Act 1995 (SA) ss 3, 27, 28, 29, 30, 36 and 42, authorised version 15.1.2026.

Last updated: 21 August 2026.

General Information Disclaimer
This article is general industry reporting and does not constitute legal advice. It summarises the effect of legislation in six Australian states as at the date above and does not cover every provision, exception, threshold or amendment that may apply. Legislation changes, and the operation of these provisions depends on the facts of each contract and each variation. Builders and homeowners should obtain their own legal advice on their specific circumstances and confirm current requirements with the regulator in their state. The Good Builder does not accept liability for any loss arising from reliance on information published here.

---