# How to record retention on a subcontractor bill in AccountRight

AccountRight has no retention report. You set it up by hand: a Retentions Payable account and an item called RETWHELD. Enter it as a negative line on each progress bill and a positive line on the final bill.

Retention is an amount held back from a subcontractor's progress claim until the work is finished or defects are fixed.

## Before you start

- Accounts and items set up

## The AccountRight way

Where to find it: Lists > Accounts and Lists > Items

1. Create a liability account: Account Type Other Liability, Account Name Retentions Payable.
2. Create an item with Item Number RETWHELD and Name Retainer Withheld. Tick I Buy This Item only and link it to Retentions Payable. Ignore the warning that the account is not an expense account.
3. On the item's Buying Details tab make sure GST/S15 is chosen in Tax/GST Code When Bought. Click OK.
4. Enter each progress bill using the Item layout with Tax/GST Inclusive ticked. Add the claim line and add RETWHELD as a negative amount for the retention.
5. Repeat for each progress payment until the last one. If you hold no more retention after the first payment, enter later payments with no RETWHELD line.
6. Before the final bill run Reports > Index to Reports > Purchases > Item > Purchases (Item Summary). Filter to RETWHELD, set Purchase Status to All Bills and pick the dates. This shows the amount withheld.
7. Enter the final bill with RETWHELD as a positive amount. This clears Retentions Payable.

## Limits in AccountRight

- Set up by hand. No retention report.
- The help records the retention on a purchase in the Item layout, because RETWHELD is an item.

## Good to know in AccountRight

- The help example is a $125,000 job paid over five months, with 10 percent ($12,500) held back from the first payment, which is entered as -$12,500.

## Example in AccountRight

Example Concrete Pty Ltd sends a progress bill and you withhold retention using the RETWHELD item.

- Progress claim: $20,000.00 (Item layout line)
- Retention withheld: -$1,000.00 (Item: RETWHELD, negative line)

The bill is $19,000.00 before any tax. Retentions Payable carries $1,000.00 until the job is signed off.

## Common mistakes

- Entering the withheld amount as a positive line. It should be a negative line using RETWHELD.
- Expecting a retention report. Track what is owed through the Retentions Payable account.

## Common questions

### How do I set up retention in AccountRight?

Create a liability account Retentions Payable (Other Liability) and an item RETWHELD, Retainer Withheld.

### How do I record retention on a progress bill?

On each progress bill, enter the withheld amount as a negative line using RETWHELD.

### Is there a retention report?

Set up is by hand and the help does not describe a retention report. Pay the retention when the job is signed off.

### Does Pulsify track retention?

No. Track retention in your accounting system or a schedule.

## Sources

- https://help.myob.com/wiki/display/ar/Withholding+payments+from+contractors
- https://help.myob.com/wiki/display/ar/Reporting+taxable+payments+%28Australia+only%29

Source: https://www.pulsify.tech/how-to/record-retention-on-a-subcontractor-bill-in-myob-accountright/ (last checked 2026-10-19)