Use AFP variable retainage to adjust retainage by item and billing period

  • Updated on Apr 30, 2026
  • Published on Apr 25, 2026
  • 1 minute(s) read
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This improvement adds more flexibility to Applications for Payment (AFP) by supporting per-item, per-period retainage rates.

Settings page for payment application with highlighted item-level retainage rate option.

What's changing?

Before, retainage in Applications for Payment (AFP) applied a single rate across the entire project. Now, you can apply different retainage percentages by line item and adjust them across billing periods. When enabled, ServiceTitan displays "Variable" as the retainage summary and automatically carries item-level retainage rates into future AFPs.

Resources

Before and After

Before (Current)

  1. Go to Project > AFPs.

  2. Create an AFP with line items.

  3. Apply a single retainage percentage to the entire AFP.

  4. Retainage calculation applies one rate across all items and periods.

  5. Continue billing without line-level retainage control.

Impact: Could not change retainage mid-project or apply different retainage to specific items.

Try the current workflow in your account.

After

  1. Go to Project > AFPs.

  2. Enable item-level retainage before the first AFP (no locked invoices or payments).

  3. Create an AFP and set retainage per line item.

  4. Use bulk actions to apply a percentage to all lines if needed.

  5. ServiceTitan tracks per-period retainage and marks retainage as "Variable."

Impact: Can update retainage rates per item mid-project and bill accurately by period.

Test the changes in the NEXT environment.

Who uses this feature

  • Residential Construction, Commercial Construction

  • Administrators, Accountants, Bookkeepers, Managers

  • Region availability: All regions

How it works for your industry

Residential Construction

  • A project starts with a 10% retainage rate but drops to 5% for labor in later AFPs. Edit the rate per item and ServiceTitan tracks the difference.

  • A builder applies no retainage to fast-turnaround items while keeping 10% on other materials. Each line can have its own rate.

  • Retainage on framing is billed differently from electrical work. Adjust item-level percentages to match subcontractor terms.

Commercial Construction

  • A hospital project switches retainage rates on plumbing and HVAC halfway through. Adjust line items per AFP for correct calculations.

  • Retainage rates vary by item on a long-term office build. Per-item tracking ensures the correct total is billed across periods.

  • For high-value items, retainage is reduced to collect more cash early. Line-level changes reflect these strategy shifts in billing.

How to Prepare?

  1. Confirm project workflows that require item-specific or changing retainage rates.

  2. Train accounting teams on when and how to enable item-level retainage.

  3. Align AFP processes to allow setting this option before the first invoice or payment.

  4. Identify projects that need retainage flexibility and plan transitions.

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