When You Need a Builder Licence in Queensland

What it is

Queensland licenses building contractors under the Queensland Building and Construction Commission Act 1991 (Qld), Schedule 1B. The threshold is set by the "regulated amount": any building work with a contract price above $3,300 requires a QBCC licence in the appropriate class.

QBCC is the licensing authority and administers the framework, including Home Warranty Scheme insurance that runs alongside the licence.

The $3,300 threshold

Schedule 1B section 5 defines a "regulated contract" as a domestic building contract priced above the regulated amount of $3,300. Above that threshold Schedule 1B licensing applies, and any building work by an unlicensed person is an offence.

Section 42 of the QBCC Act 1991 makes it an offence to carry out building work above the regulated amount without a licence. Section 42(4) removes the contract price and quantum meruit recovery rights of an unlicensed contractor. The owner can still enforce warranties and claim damages.

Level 1 vs Level 2 contracts

Above the $3,300 base threshold, Schedule 1B splits regulated contracts into two levels by price:

• Level 1 regulated contract (s 6): price between $3,301 and $19,999
• Level 2 regulated contract (s 7): price at or above $20,000

Section 45 of the QBCC Regulation 2018 prescribes $20,000 as the Level 2 amount. The boundary sits at exactly $20,000, and a contract struck at $20,000 on the nose is Level 2 rather than Level 1.

The distinction matters because Level 2 contracts carry more onerous formality requirements: cooling-off, cost-plus permissibility restrictions, price-change first-page warning under section 14, mandatory Consumer Building Guide under section 18.

Licence classes

QBCC issues licences by class of work. The main classes for residential building are:

• Builder Low Rise: residential work up to 3 storeys
• Builder Medium Rise: residential work up to 4 storeys
• Builder Open: any building work
• Trade contractor licences (bricklaying, carpentry, plumbing, electrical, etc.)

Each class has its own qualification, experience and Minimum Financial Requirement (MFR) framework. A licensee must have a Nominated Supervisor for each licence class held.

Minimum Financial Requirements

Section 50E of the QBCC Act imposes Minimum Financial Requirements on licensees. MFR categories run from SC1 (Self-Certifying Category 1) through to Cat 7, with revenue caps and Net Tangible Asset thresholds at each level. Larger builders must lodge annual financial reports (audited above certain thresholds) to maintain MFR compliance.

Non-compliance with MFR is grounds for licence conditions, suspension or cancellation. QBCC's MFR audit program is a routine compliance touchpoint for licensed builders.

Owner-builder permit

Owner-builder work is exempt from the licensing requirement provided the owner holds an owner-builder permit under section 42D of the QBCC Act 1991 (Qld). The permit applies to a single project on land the owner owns.

Restrictions include a 6 year sale prohibition without disclosure to the purchaser, an owner-builder training course requirement for permits above a prescribed value, and a general prohibition on doing the work as a business.

The BIF Act 2017 subcontractor context

While Schedule 1B focuses on head-contract licensing, the Building Industry Fairness (Security of Payment) Act 2017 (Qld) runs alongside for subcontractor payment protection. BIF Act Chapter 3 does not apply where a resident owner is a party to the head contract, but subcontractors retain full BIF rights against the head builder.

Consequences of unlicensed work

The section 42 offence carries penalty units and possible imprisonment. Section 42(4) removes the contractor's contract price recovery rights. QBCC can also take separate licensing action against a related licensed entity if the unlicensed work has connections to a licensee.

How Queensland compares

Queensland's $3,300 threshold is the lowest in Australia. NSW is $5,000 (s 4 HBA). VIC is $10,000 (s 29 DBCA). WA is $20,000 (permit work). ACT is $12,000. TAS, SA and NT have their own thresholds and structures.

The QBCC concentrated model (licensing, direction to rectify, insurance scheme administration) is unusual internationally and gives QLD builders and owners a single regulator touchpoint across the whole framework.