Status: the rules are in force, and the province has opened a review of how contractors are licensed.
An Alberta contractor who takes money before the work is finished, under a contract made away from the contractor’s own place of business, must hold a licence from Service Alberta and post security. That is the starting point for anyone asked to pay a renovation deposit this fall, and it comes from the province’s guidance for people hiring a contractor, last updated on September 23, 2026.
Key facts
- A prepaid contracting business is one that solicits, negotiates or concludes contracts away from its own place of business and takes money before the work is complete, and it covers construction, repair and improvement of private dwellings (Government of Alberta, prepaid contracting regulation summary, October 2023).
- A prepaid contract of $200 or more must be in writing and must itemize the work, the materials, the prices, the total including taxes, the completion dates and the payment terms (Government of Alberta, October 2023).
- The buyer receives a copy on or before the day work begins, or within 10 days of signing, whichever comes first (Service Alberta, October 6, 2022).
- The buyer can cancel within 10 days of receiving the copy without giving a reason, and a refund is due within 15 days (Service Alberta, October 6, 2022).
What the contract has to say
A written contract is the first protection, and the rule on its contents is specific. It has to name the parties and their addresses, the date and place of signing, the itemized work and materials, the itemized prices and the payment terms. It also has to state the buyer’s cancellation rights and carry both signatures. A quote scribbled on the back of a business card does not meet that list.
The deposit itself is a matter of advice rather than a fixed rule in the sources reviewed here. Service Alberta suggests asking if the deposit is refundable, getting a signed receipt for every payment, paying the final amount only after the work is complete and inspected, and treating a large request for materials money up front with caution.
The 10-day window
The cancellation right belongs to contracts made away from the contractor’s place of business. It runs for 10 days after the buyer receives a copy of the contract, and notice has to go by a method that proves the date. The refund is due within 15 days.
Some limits apply. A contractor may be owed reasonable payment for work already done. The right can last up to a year in some cases, for example where the contractor was not licensed when the contract was signed. The contract itself should state all of this, since the written statement of cancellation rights is a required part of it.
Checks before paying
Three checks come before a first cheque. Confirm with Service Alberta that the contractor holds a prepaid contracting licence. Ask for the contractor’s Workers’ Compensation Board clearance letter, which the WCB says shows if a business has coverage and is in good standing, and which it advises getting before hiring and before releasing payment. Ask for a certificate of liability insurance, and tell the home insurer about the work.
On the liability question, Service Alberta says that if an uninsured worker is hurt, the homeowner and the other party would have to agree on who is liable, and without agreement the matter can end in court. The WCB pages reviewed here do not address homeowners by name, and this column does not state a homeowner’s legal liability.
The same ground is covered in the piece on the 2017 door-knocking ban that skipped solar, where a different kind of contract is sold at the door.
If it goes wrong
The Service Alberta Contact Centre issues a complaint number on 1-877-427-4088, and the complaint is then filed through the Consumer Complaint Portal. The Consumer Investigations Unit decides if a file gets investigated. It can issue a warning, recommend a licence suspension, order a penalty or file charges, and it cannot recover money or mediate. Civil claims under $100,000 go to the Alberta Court of Justice.
A buyer who lost money to a licensed contractor can also claim against the security that the contractor posted. Service Alberta’s 2022 guidance says claims are made by statutory declaration, are usually due within two years of when the operator was licensed, and can take up to three years to pay out. A buyer should confirm those terms with Service Alberta, because the guidance is from July 2022.
The Government of Alberta’s guide to hiring a contractor carries the licence, contract and insurance points, and the complaint page lists the steps. The WCB clearance letter page links to the request tool.
Service Alberta and Red Tape Reduction opened an engagement on May 19, 2026 on a combined licensing framework for direct sellers and prepaid contractors, with sessions to follow. No result or rule change had been published in the sources reviewed. The next step is the release of those engagement results.
