What kicks off the 60-day lien holdback clock on my Toronto reno?

The 60-day lien holdback clock starts on the date of "substantial performance" of your contract — not when the last nail is hammered or the final invoice arrives. This is one of the most misunderstood timelines in Ontario construction law, and getting it wrong can cost homeowners and contractors alike.

Substantial performance is defined under Ontario's Construction Act (formerly the Construction Lien Act). A contract is substantially performed when the work is ready for use or being used for its intended purpose, and the cost to complete or fix remaining deficiencies is no more than the lesser of 3% of the first $1,000,000 of the contract price, 2% of the next $500,000, and 1% of the balance. In plain terms: the project doesn't have to be 100% done — it just has to be functionally complete with only minor deficiencies remaining.

The contractor is required to publish a Certificate of Substantial Performance (CSP) in a construction publication (typically the Daily Commercial News) once substantial performance is reached. That publication date is what officially triggers the 60-day lien period for subcontractors and suppliers to file liens against your property. As a homeowner, you should ask your general contractor when this certificate is being published — don't assume it happens automatically or promptly.

For Toronto homeowners specifically, this matters most on larger renovations — full gut jobs, additions, basement underpinning, or any project involving multiple subtrades. On smaller jobs under $1,000 (think a single-day repair), the lien rules still technically apply, but the practical risk is lower. On anything significant, you want to understand that the 10% holdback you're required to retain throughout the project cannot be released until the 60-day lien period expires without a lien being filed — or until any filed liens are resolved.

The practical takeaway: don't release your final holdback payment the moment your contractor says they're done. Wait for the CSP to be published, note that date, and hold your 10% for the full 60 days after. If a subcontractor or supplier wasn't paid by your GC, this holdback is your protection — and theirs.

This is genuinely an area where a construction lawyer's 30-minute consultation is worth every dollar, especially on renovations over $50,000. The rules changed significantly when Ontario updated the Construction Act in 2018 and 2019, and the prompt payment provisions added further complexity to the timeline.

Your next step is to confirm with your contractor whether a CSP will be published on your project, and document the publication date in writing. If you're mid-project and unsure where you stand, browse licensed general contractors in our directory at Toronto Construction Network — a reputable GC will walk you through these obligations before you sign anything.