# How to record retention on a subcontractor vendor invoice in Sage 300

Work out the retention under the contract, record the A/P invoice for the full claim and the amount held back and track the retention balance for the vendor until you release it.

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

## Before you start

- Sage 300 Accounts Payable
- Security authorisation for the screen

## The Sage 300 way

Where to find it: A/P Setup > Options; A/P Invoice Entry > Retainage tab; A/P Periodic Processing > Create Retainage Batch

1. Set default retainage percentage, retention period and retainage terms on A/P Options and the vendor Invoicing tab.
2. On the invoice enter retainage percentage or amount, retention period and due date for each detail, and set terms on the Retainage tab.
3. The retained part posts to Retainage Control as a separate retainage document.
4. Later run A/P Periodic Processing > Create Retainage Batch to invoice outstanding retainage.
5. Run the Aged Retainage report to track it.

## Limits in Sage 300

- Retainage invoices and credit notes can also be entered manually.
- Australian security of payment rules are not part of the Sage guide.

## Example in Sage 300

Example Concrete Pours sends a progress claim for $10,000 before tax. The detail carries a 5% retainage percentage and a retention period.

- Slab progress claim, payable now: $9,500.00 (Normal payable)
- Retainage held at 5%: $500.00 (Retainage Control, separate retainage document)

The $500.00 stays in Retainage Control until A/P Periodic Processing > Create Retainage Batch invoices it. The Aged Retainage report shows it while it is held.

## Common mistakes

- Entering retainage on the invoice without setting terms on the Retainage tab.
- Forgetting to run Create Retainage Batch, so retained amounts are never invoiced.

## Common questions

### How do I set default retainage in Sage 300?

Set the default retainage percentage, retention period and retainage terms on A/P Options and on the vendor Invoicing tab.

### What happens to the retained amount?

It posts to Retainage Control as a separate retainage document. Later, run A/P Periodic Processing > Create Retainage Batch to invoice the outstanding retainage.

### How do I track what is still held?

Run the Aged Retainage report. It is separate from the Aged Payables report.

### Does Pulsify track retention?

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

## Sources

- https://cdn.na.sage.com/docs/en/customer/300erp/2023/open/Sage300_AccountsPayable_UserGuide.pdf

Source: https://www.pulsify.tech/how-to/record-retention-on-a-subcontractor-bill-in-sage-300/ (last checked 2026-10-19)