Think You’re Under the Threshold? Why That Could Still Be Illegal Building Work
For many tradies across Australia, there’s a common misconception floating around job sites and in group chats:
“If I invoice under the threshold, I don’t need a licence.”
Sounds simple.. but it's dead wrong.
In this post, we break down why that mindset is risky, what the actual rules are in each state, and how tradies are getting caught out without even realising it.
It’s Not Just About Your Invoice, It’s the Total Project Value
This is the #1 trap we see tradies fall into. A chippy might quote $4,000 for a decking job, or a plumber might invoice $3,000 for their part of a bathroom reno and assume they’re safe because they’re “under the threshold.”
But here’s what really matters:
Regulators assess the value of the entire project.. not just your slice of the work.
If you’re working on a job where the total cost of materials and labour (including what other tradies are doing) exceeds the state’s licensing threshold, you’re considered to be doing unlicensed building work if you don’t hold the correct licence.
State Breakdown of Licensing Thresholds
Each state in Australia sets its own limit for when a licence is required and they vary a lot:
Victoria (VBA)
- A license is mandatory for any domestic building project exceeding $10,000 (including both labor and materials). This encompasses tasks such as renovations, extensions, bathroom and kitchen remodels, and more.
New South Wales (Fair Trading)
- A license is required for any residential building work that surpasses $5,000. Even if you're involved in a larger renovation project, if the total costs exceed $5,000.. licensing is necessary.
Queensland (QBCC)
- A license is needed for building work that goes beyond $3,300. This threshold, which includes both materials and labor, is among the lowest in the country.
IMPORTANT: These amounts are not based on your invoice, they’re based on the full value of the project. That’s what regulators look at.
Examples of How Tradies Get Caught Out
Let’s say you're a carpenter in NSW, and you quote $4,800 for a pergola install. You think you're under the $5,000 mark, so you don't need a licence... right?
Wrong.
If the homeowner also pays for an electrician to wire in some lighting and a painter to stain the timber, and the whole job ends up costing $7,000 you’ve now done unlicensed work on a project that legally required a licence.
Same goes in QLD, we’ve seen tradies fined for invoicing $3,200, only to have the QBCC step in after finding out the full project exceeded $3,300.
What Are the Risks of Flying Under the Radar?
Working unlicensed on projects that exceed the legal threshold can lead to:
- Fines from your state regulator
- Bans from applying for or holding a licence in future
- Legal disputes with homeowners and no legal protection if things go wrong
- Damage to your reputation as a professional tradie
We’re not talking about horror stories either, this is happening all the time, especially as state regulators are tightening up compliance.
“But I Only Did a Small Part!” ... It Doesn’t Matter.
Another myth is that being just one of several tradies on a job gets you off the hook. Not true.
Regulators assess your involvement in unlicensed work, regardless of who else is working on the project. If the job exceeds the threshold and you don’t hold the proper licence.. you’re in breach.
How to Stay Compliant and Protect Your Business
The best way to avoid issues is simple:
- Understand the rules in your state
- Don’t rely on the invoice value — think about the full job cost
- If in doubt, get licensed or speak to an expert who can guide you through the process
At Licensing Advice, we help tradies across VIC, NSW and QLD get licensed fast — and avoid mistakes that could cost them thousands.
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