For businesses
Customer refuses to pay a deposit? What they are really saying
When a customer refuses to pay a deposit, the objection is almost never the amount; it is that they cannot verify who they are paying or get the money back if the job fails. A deposit of 30–50% is normal for bespoke work and 5–20% in stages for building work. Show a checkable legal entity, put the contract in its name, offer card payment for the first stage, and most refusals turn into payments.
Key facts
- A deposit of 30–50% is normal for bespoke trades (staircases, kitchens, windows, joinery); 5–20% in stages for building work; 10–30% for installations (SafeToPay deposit guidance, methodology v1.2).
- A bank transfer to a company that later fails is usually unrecoverable; the customer ranks as an unsecured creditor behind secured and preferential creditors (Insolvency Act 1986, s.175 and Sch. 6).
- Paying any part of a £100–£30,000 purchase by credit card makes the card issuer jointly liable for the whole contract (Consumer Credit Act 1974, s.75).
- A “non-refundable” deposit that exceeds the trader’s genuine losses on cancellation is likely to be an unfair term and unenforceable (Consumer Rights Act 2015, Part 2; CMA unfair contract terms guidance).
- Contracts agreed at the customer’s home carry a 14-day cancellation right; work started within that period must be requested in writing (Consumer Contracts Regulations 2013, regs. 29–36).
Why customers refuse to pay a deposit
A customer refuses a deposit because they have no way to recover it, not because they doubt the price. Consumer guidance from Citizens Advice, Which? and Trading Standards now says the same three things: check the company on Companies House, never pay a large sum by bank transfer, and pay at least part by credit card. A customer who has read any of it arrives with a checklist, and a business that cannot tick it looks risky whatever the quote says.
The refusal is therefore a request for evidence. The customer wants to know four things: who exactly they are paying, whether that entity can be found on a register, whether the amount is normal for the trade, and what happens to the money if the job stops. Answer all four and the deposit is rarely the sticking point; leave one open and no discount will fix it.
What deposit is normal for your trade
A deposit is normal when it matches the cost the business commits before delivery, and customers are increasingly told what that figure looks like for each trade.
| Trade | Normal deposit | Why | Reads as excessive when |
|---|---|---|---|
| Bespoke staircases, joinery, furniture | 30–50% | Materials bought and workshop time booked before anything is delivered | Above 50%, or the balance demanded before delivery |
| Kitchens and bedrooms | 25–50% | Units ordered to size from the manufacturer | Full payment before installation |
| Windows and doors | 25–50% | Made to measure; FENSA/CERTASS members often use scheme deposit protection | Over 50% with no deposit protection |
| Building work, extensions, lofts | 5–20%, then stages | Costs arrive week by week; stage payments follow the work | Over 25% up front, or stages ahead of the work |
| Installations (heating, solar, electrics) | 10–30% | Equipment ordered; labour is short | Over 50% for standard equipment |
| Cars from a dealer | Reservation fee, £99–£500 | Holds the vehicle; refundable if the sale falls through | Any “deposit” above a reservation fee before the car is seen |
These are the thresholds SafeToPay shows to customers in every full report, so they are the numbers your customer is comparing your quote against. A deposit inside the band is unremarkable; one above it needs a written reason (an unusually large material order, for instance) and, ideally, deposit protection.
Five objections and what answers each
Each objection below maps to one missing piece of evidence, and each is fixed by showing the evidence rather than arguing.
| What the customer says | What they mean | What answers it |
|---|---|---|
| “I don’t pay anything up front.” | I can’t tell whether you’ll still exist next month. | Company number on the quote; point them to your Companies House record; card payment for the deposit. |
| “That’s a lot to pay before I’ve seen anything.” | I don’t know what is normal for this trade. | Say the band for your trade and where you sit in it; explain what the deposit buys (materials, workshop slot). |
| “Can I pay by card?” | I want Section 75 or chargeback. | Yes. A card link for the deposit costs 1.5–2% and closes most refusals. |
| “Who is the invoice from? The website says a different name.” | Brand, company and bank account don’t match. | Registered name and number on quote, contract and invoice; bank account in the company’s name. |
| “What if you go bust?” | I’ve read that transfers to failed companies aren’t refunded. | Card payment; scheme deposit protection where it exists; stages that never run ahead of the work. |
The name on the invoice is the biggest single trigger
A quote headed with a brand, a bank account in a director’s personal name and a website with no company number is the pattern customers are warned about in guides to changed-bank-details fraud. Nothing is wrong, but nothing is checkable either. One template change — registered name and company number at the top of the quote and the invoice, bank account in the same name — removes the objection for every future customer.
Card payment is cheaper than a lost job
A card link for a £4,000 deposit costs the business roughly £60–£80 in fees and gives the customer a card issuer standing behind the whole contract. A firm that refuses card payment for a five-figure job is asking the customer to carry all of the risk, and the careful ones now know it. The mechanism, including why the whole contract is covered when only £100 goes on the card, is in the Section 75 guide.
“Non-refundable” is not a magic word
Customers increasingly know that a deposit forfeited on cancellation must reflect the trader’s real loss. A term that keeps 50% regardless is likely unfair under the Consumer Rights Act 2015 and reads as a warning sign in itself. Deposit terms that say what the money is spent on, and what is returned if the customer cancels before materials are ordered, are both enforceable and reassuring.
The refusal you should respect: if a customer will not pay a deposit until they have seen a company number, an address and a card option, they are following the same checklist SafeToPay gives them. The fix is to provide those three things, not to lower the deposit.
Two real checks
Both from live checks; names withheld, figures as filed on the register.
Fitted furniture manufacturer, 40 years on the register
Full accounts on time, net assets of £1.8 million, own factory, landline and postcode shown, company number on every page. The firm asks for 50% on order — the top of the band for bespoke work — and a customer running the check sees why it is acceptable: the entity is old, solvent and identifiable, and the deposit is going into a balance sheet that can absorb it. Deposit guidance in the report: 30–50% normal, pay the first stage by card, no further concern.
Loft conversion company, five years on the register
Active, accounts on time, good reviews — and net liabilities of £111,000 in the latest filing. The company is trading and the work may be excellent, but a customer reading the accounts sees that a £6,000 deposit by transfer would rank behind £111,000 of existing creditors if trading stopped. Deposit guidance in the report: 5–20% only, card for the deposit, stages strictly behind the work. A business in this position wins the job by offering exactly that schedule before being asked, not by defending the deposit.
Enter a website address, e.g. smithkitchens.co.uk
A payment schedule customers accept
A schedule is accepted when every payment is tied to something the customer can see, and when the first payment is recoverable.
- Deposit inside the band for your trade, stated on the quote with what it covers (materials, workshop slot, survey).
- Card payment offered for the deposit, by link or terminal. Bank transfer can follow for later stages if you prefer.
- Contract, invoice and bank account in the registered company name, with the company number on each.
- Stage payments defined by milestones (“on delivery to site”, “on completion of first fix”), never by date, and never more than one stage ahead of the work.
- Final payment on completion and sign-off, with a retention of 5–10% for snagging on larger jobs — offering it unprompted is a strong trust signal.
- Deposit terms in writing: what is refunded if the customer cancels before materials are ordered, and what is retained after.
Show your record before the deposit conversation
The customer who refuses has usually already tried to check you and found nothing to check. A business that links to its own public record from the quote or the website turns the deposit conversation around: the customer sees the legal entity, its age, its accounts and its directors before they ask, and the deposit becomes a line item rather than a leap of faith. SafeToPay’s verified business badge does this free, with a full report refreshed on every re-check and no verdict colour. What customers read once they get there is set out in what customers see on Companies House, and the ten-minute setup in how to prove your business is legitimate.
Enter a website address, e.g. smithkitchens.co.uk
Frequently asked questions
Can I refuse to start work without a deposit?
Yes. There is no legal obligation to work without a deposit, and for bespoke work a deposit is standard. The obligation runs the other way: the amount must reflect genuine costs, and any forfeiture on cancellation must match your real loss to be enforceable.
How much deposit can I ask for legally?
There is no statutory cap. Consumer law tests whether the deposit and any non-refundable term are fair, meaning proportionate to the costs you commit. 30–50% for made-to-order work and 5–20% for building work are the bands customers are told to expect.
Is it a red flag to a customer if I only accept bank transfer?
Increasingly, yes. Consumer guidance tells people that transfers to a failed company are not refunded and to pay by credit card where possible. Accepting card for at least the deposit removes the objection at a cost of about 1.5–2%.
The customer wants to pay by credit card but my fee is high. Can I add a surcharge?
No. Surcharges on consumer credit and debit card payments have been banned in the UK since January 2018 (Consumer Rights (Payment Surcharges) Regulations 2012, as amended). You can price the job to include card costs, but not add a separate fee for paying by card.
What if my accounts show a loss and the customer has seen them?
Explain the year and change the schedule rather than defending the deposit: a smaller deposit by card, stages behind the work, and a retention at the end. Customers who see a business protecting their money tend to proceed; those who see it argue tend not to.
Does deposit protection through a trade scheme help?
Yes, where it exists. Some FENSA and CERTASS members, and firms in insurance-backed schemes such as QANW or IWA, can offer deposit protection that refunds the customer if the business fails before delivery. If you have it, put the scheme name and your registration number on the quote.
Sources
- Consumer Rights Act 2015, Part 2 — unfair terms — legislation.gov.uk
- CMA — Unfair contract terms guidance (CMA37)
- The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 — legislation.gov.uk
- Consumer Credit Act 1974, section 75 — legislation.gov.uk
- Consumer Rights (Payment Surcharges) Regulations 2012 — legislation.gov.uk
- Insolvency Act 1986 — order of creditors — legislation.gov.uk
- Citizens Advice — Consumer
- SafeToPay methodology v1.2 — deposit guidance