Renovation Contract Checklist for Ontario Homeowners: What Must Be in Writing Before Work Starts

 A renovation contract is not a sign of distrust. It's a shared record of what both parties agreed to — and the document you both go back to if anything is disputed. Any contractor worth hiring expects to sign one.

The problem isn't that homeowners skip contracts entirely. It's that the contracts they sign are vague enough to be useless. 'Kitchen renovation, all included, $45,000' is not a contract. It's an invitation to a dispute.

Here's what a renovation contract for an Ontario homeowner must include — and why each element matters.

1. Detailed Scope of Work

This is the most important part of the contract and the most commonly done wrong. The scope must be specific enough that there is no ambiguity about what is included. Not 'bathroom renovation.' Instead: remove existing vanity, toilet, and tub; supply and install new freestanding tub; supply and install new double-sink vanity per approved drawing; retile shower walls with 3x6 subway tile.

Every item that could possibly be misunderstood should be spelled out. If it's not in the scope, assume it's not included.

2. Start Date and Substantial Completion Date

Both dates must be in the contract. Substantial completion is the point at which the project is functionally usable, even if minor deficiencies remain. Without an agreed substantial completion date, you have no defined benchmark for when the project is considered late.

Include a clause about what happens if the completion date is missed — whether through contractor delay, material backorder, or other causes — and who is responsible for what.

3. Payment Schedule Tied to Milestones

Payments should be triggered by project stages, not calendar dates. A typical schedule for a kitchen renovation might look like: 10% deposit at signing, 25% upon completion of demolition and rough-in, 25% upon drywall completion, 25% upon cabinet installation, and the balance at substantial completion minus the statutory 10% holdback.

Never pay the full balance before substantial completion. The remaining payment — and the holdback — are your leverage to ensure deficiencies are corrected.

4. Change Order Process

This clause alone prevents more disputes than any other part of the contract. It should state explicitly: no change to scope or cost proceeds without a written change order signed by both parties. The contractor cannot add cost or modify the scope based on a verbal conversation, a text message, or a handshake.

Every change order should document what is being changed, the additional cost, and the impact on the project schedule. Both parties sign before work proceeds.

5. Labour Warranty

The standard minimum for labour warranty in Ontario is one year from substantial completion. This covers defects in workmanship — not damage caused by misuse or normal wear. Get the warranty terms in writing: what it covers, what it excludes, and the process for raising a warranty claim.

Note: Tarion does not cover renovation work. Tarion is for new home purchases only. Your written warranty clause is your protection.

6. 10% Statutory Holdback

The contract should explicitly reflect the statutory holdback. Each milestone payment should show the full amount and the holdback-adjusted amount you'll actually pay. The holdback release conditions (45 days from substantial completion with no liens on title) should be written in.

7. Dispute Resolution Process

Include a clause that defines what happens if there's a disagreement about quality, cost, or scope. Mediation before litigation is a reasonable approach. Since 2018, Ontario's Construction Act has also included a prompt payment adjudication process for payment disputes — a faster alternative to going to court that's worth including as an option.

Before You Sign

Read the entire contract. Ask questions about anything that's vague or missing. If you paid a lawyer $300 to review a $50,000 renovation contract, that's money well spent. A contract that's signed and clear is worth significantly more than a verbal agreement you thought you both understood.

→ Ready to hire a contractor in the GTA? Read our complete guide: How to Hire a Renovation Contractor in the GTA — Complete Guide