How to Start a Carpentry Business in Australia

Subbie to builders, or contract direct?

This choice shapes everything else — your licensing, your insurance, your marketing, your cash flow and how many hours a week you spend not holding a tool. Most carpenters start on the first path and move toward the second as their business matures.

The trap on the subbie path is single-client risk. It feels like security right up until the builder slows down, and by then you have no pipeline of your own and no marketing. Even if you're happy subcontracting, keep a second builder warm and take the occasional direct job so you're not one phone call from nothing.

Licensing and what you're allowed to contract for

Carpentry itself isn't licensed the way electrical and plumbing are. Building work is — and the line between the two is drawn by the value of the contract, not by how complicated the job feels. Queensland licenses carpentry as its own trade class; New South Wales does the same; Victoria handles it through domestic builder registration. What they share is a dollar threshold, and it's low.

Three states shown because they're the ones most commonly asked about — the other jurisdictions all run their own numbers. These thresholds move, so treat the table as a signal that the bar is low rather than as the last word, and confirm the current figure for your state before you sign anything.

• Contracting direct with a homeowner above that threshold requires you to hold the licence or registration in your own right. Below it the rules are looser — but a single kitchen or a deck clears every one of these numbers comfortably.
• Working as a subbie to a licensed builder is a different situation — you're operating under their licence and their contract with the owner, which is exactly why the subbie path is easier to start on.
• Home warranty or domestic building insurance kicks in above its own, higher threshold on residential contracts — in NSW that's contracts over $20,000, where cover has to be in place before you start work or take a deposit. It's the contractor's obligation, not the owner's.
• Owner-builder work has its own rules again, and your obligations don't disappear because the client says they'll handle the paperwork.
• Site inductions and tickets — a construction induction card is standard, and specific sites want more. Working at heights, EWP and asbestos awareness turn up regularly.

What you'll be spending money on

Carpentry setup is dominated by tools and a vehicle, and the number swings wildly depending on how much of your own kit you already own. Price these categories for yourself rather than working off a general figure.

If you're contracting direct, the working capital line is the big one. Materials for a deck or a reno go on your card weeks before the client pays, and a builder's progress claim can take a month to convert to money in your account. Structure your payment terms so you're not banking the job yourself.

Pricing when materials won't hold still

Carpentry pricing has a specific hazard: you quote in March, you build in June, and the timber has moved. Fixed-price work is what clients want and it's how you make margin — but only if the quote protects you.

• Build your charge-out rate properly from overheads and genuinely billable hours, not from what the last builder paid you. Subbie day rates are labour-only prices and they don't cover running a business.
• Put a validity period on every quote — 14 or 30 days — and state that pricing is subject to supplier rates at the time of order.
• Itemise the scope so variations are obvious. A lump sum invites arguments about what was included.
• Price materials with a stated margin, and remember a 20% markup is not a 20% margin.
• For longer jobs, set progress claim stages tied to visible milestones — deposit, frame up, lock-up, completion — so you're never more than one stage out of pocket.
• Allow for waste, offcuts and delivery, and for the days you can't work because it's raining or the slab isn't ready.

Our guide to working out your charge-out rate covers the calculation, and writing a scope of work covers how to define the job so a variation is a conversation rather than a fight.

Getting paid, and the paperwork that makes it happen

Carpenters are more exposed to slow payment than most trades, because so much of the work sits behind a builder or a developer's payment cycle. The fix is unglamorous and it's mostly documentation.

1. Agree the terms in writing before you start. Payment stages, timing and what triggers each claim. A handshake on a $40,000 job is not a payment plan.
2. Take a deposit on direct work. Enough to cover the materials you'll buy before the first claim. Clients accept this readily when it's presented as standard.
3. Claim on time, every time. Late claims tell a builder your cash flow isn't tight and you'll wait. Send the claim the day the stage is reached.
4. Photograph everything before it's covered. Frames, fixings, flashings, blocking. Once the linings are on, your photos are the only record of what you actually did.
5. Get variations approved before you build them. A written approval takes two minutes on the phone. An unapproved variation is a gift you didn't mean to give.
6. Chase early and politely. A reminder the day after an invoice falls due is normal business. Waiting three weeks because it feels awkward is how a slow payer becomes a bad debt.

Frequently asked questions