Main contractor’s discount
The term 'main contractor’s discount' (MCD) refers to a clause that can be included in building subcontracts to encourage main contractors to pay their subcontractors within the period of time specified in the contract.
A discount (typically, 2.5%) is deducted if the main contractor pays promptly, with the subcontractor able to recover the discount by adding an amount to the contract sum. The discount is applied to the value of works undertaken by the subcontractor and deducted from any application for payment. The discount should be clearly stated on invoices, applications and accounts.
MCD clauses were, until relatively recently, a feature of some standard forms of contract, but they have now generally been removed. They still however appear in some bespoke contracts, where they are not always related to prompt payment, but rather are seen as a management fee.
[edit] Find out more
[edit] Related articles on Designing Buildings Wiki
Featured articles and news
Reviewing the Roadmap to Recovery
Engineering services in the spotlight.
The Government's Summer 2020 economic update.
Britain's underground asset register
Getting organised below the surface.
Securing suitable water systems.
Love them or hate them, they are popping up everywhere.
The initiative to enhance the environment continues.
Could underused community spaces offer an alternative to working from home?
Keeping workers and workplaces safe in the United States.
A history lesson in geographic information systems.
A low tech, easy to use method of extinguishing small fires.
How can these valued spaces be reused?
Partnership avoids the need for listed building consent.