Most civil work is not paid in one go at the end. It is paid in instalments as the work progresses, through running account bills, or RA bills. A clear RA bill format saves arguments: both sides can see what was billed before, what is being billed now and what has been billed in total. This guide explains how RA bills work, the sections every RA bill should have, the usual deductions and a worked example you can check line by line.
What is an RA bill? (RA bill full form)
RA stands for Running Account. An RA bill is an interim bill raised during a contract for the work completed so far, measured against the items and rates agreed in the work order or contract. It is "running" because each bill carries forward everything billed before it, and the account stays open until the final bill.
RA bills flow in two directions on most projects. A contractor raises them on the client, and a contractor also receives them from its own subcontractors for masonry, plastering, shuttering, electrical and similar packages. The format is the same either way; only who prepares and who certifies changes.
How cumulative RA bills work: RA-1, RA-2, RA-3
Bills are numbered in sequence: RA-1 for the first period, RA-2 for the next, and so on until the final bill. The key idea is that every RA bill is prepared on a cumulative basis. For each item you record three quantities:
- Previous – the total quantity certified in all earlier RA bills.
- This bill – the quantity done during the current billing period.
- Cumulative (up to date) – previous plus this bill.
The amount payable on this bill is the cumulative value less the previous value. Working cumulatively has a practical benefit: if an earlier quantity was over- or under-measured, it is corrected in the up-to-date figure, and the difference falls into the current bill automatically. Nobody has to reopen RA-1.
Run your subcontractor management on CivilPilot
Work orders, progress, RA bills, retention and advances for every subcontractor, with a portal they can use.
RA bill format: the sections to include
| Section | What to record | Why it matters |
|---|---|---|
| Header | Project, subcontractor or contractor, work order number, RA bill number, billing period, bill date | Ties the bill to one agreement and one period |
| Item lines | Item number, description and unit exactly as in the work order | Prevents new items creeping in without approval |
| Rate | The agreed rate for each item | Rates should never be retyped by hand each month |
| Quantities | Work order quantity, previous, this bill, cumulative, balance | Shows progress and what is left to execute |
| Amounts | Previous, this bill and cumulative amount for each item | The cumulative view keeps the account honest |
| Deductions | Retention, advance recovery, material issued, other statutory deductions | Turns the gross amount into what is actually paid |
| Net payable | Gross this bill less deductions | The figure accounts will release |
| Supporting records | Measurement sheets, progress photos, reference to the progress reports | The evidence behind each quantity |
| Sign-off | Prepared by, checked by, certified by, with dates | Makes the bill accountable |
Deductions on an RA bill
The gross value of work done is rarely what gets paid. The common deductions are:
- Retention – a part of each bill held back until the defect liability period ends. The percentage and release terms come from the contract. See our guide to retention money in construction.
- Advance recovery – if a mobilisation or material advance was paid, it is recovered from RA bills in the way the work order sets out, for example a fixed amount per bill or a share of each bill.
- Material issued – where you supplied cement, steel or other material to the subcontractor on a chargeable basis, its value is recovered as agreed.
- Other statutory deductions – such as tax deducted at source, as applicable under your contract and as advised by your tax advisor. This guide does not cover rates or rules.
This is general information about common practice. Check the terms of your own contract, and take tax questions to your accountant or tax advisor.
Worked example: an RA-3 bill
A masonry and plastering subcontractor is working under a work order with three items. Two RA bills have already been certified. Here is RA-3. All quantities, rates and percentages are sample figures for illustration only, not market rates.
| Item | Unit | Rate | Prev. qty | This qty | Cum. qty | Prev. amount | This bill | Cum. amount |
|---|---|---|---|---|---|---|---|---|
| Brickwork 230 mm | cum | 6,500 | 120 | 45 | 165 | 7,80,000 | 2,92,500 | 10,72,500 |
| Internal plaster 12 mm | sqm | 320 | 900 | 600 | 1,500 | 2,88,000 | 1,92,000 | 4,80,000 |
| PCC 1:4:8 | cum | 5,200 | 80 | 0 | 80 | 4,16,000 | 0 | 4,16,000 |
| Total | 14,84,000 | 4,84,500 | 19,68,500 |
Check the arithmetic the way a certifier would: previous plus this bill equals cumulative, so ₹14,84,000 + ₹4,84,500 = ₹19,68,500. The PCC item is fully executed, so it carries forward with nothing in this bill.
Now the deductions. In this example the work order sets retention at 5% of each bill and recovers a ₹1,00,000 mobilisation advance in four equal instalments of ₹25,000.
| Line | Basis | Amount |
|---|---|---|
| Gross value, this bill | From the table above | 4,84,500 |
| Less retention | 5% of 4,84,500 (example rate) | 24,225 |
| Less advance recovery | Instalment 3 of 4 | 25,000 |
| Net before other statutory deductions | 4,84,500 − 24,225 − 25,000 | 4,35,275 |
| Less other statutory deductions | As per contract and tax advisor | — |
Keep a running total of retention too. At 5% on every bill, retention held up to RA-3 is 5% of ₹19,68,500, which is ₹98,425. That is ₹74,200 from the first two bills plus ₹24,225 from this one.
Who prepares, checks and certifies an RA bill?
- 1The subcontractor (or contractor) submits the bill with quantities for the period.
- 2The site engineer checks the quantities against measurements taken on site and the daily progress reports.
- 3The project manager or billing engineer checks rates, cumulative totals and deductions against the work order.
- 4Accounts releases payment against the certified net amount.
Quantities hold up best when the work was recorded as it happened. A same-day daily progress report with quantities and photos is the easiest evidence to point to when a quantity is questioned.
Common RA bill mistakes
- Billing only "this period" without cumulative columns. Errors from earlier bills never get corrected.
- Items that are not in the work order. Extra items need an approved amendment or a separate order first.
- Retention tracked in someone’s head. Record retention held on each bill, or it will be forgotten at release time.
- Advance recovery stopped early or never started. Track the balance of each advance after every bill.
- No link to measurements. A quantity without a measurement or progress record behind it becomes a dispute.
Raise subcontractor RA bills against work orders
An RA bill is only as good as the work order behind it. If the items, units and rates are fixed in the order, the bill becomes a matter of quantities. Our work order format for civil work covers what that order should contain.
Do this in CivilPilot
In CivilPilot’s subcontractor management, you keep a subcontractor register with GSTIN and PAN, and issue work orders with line items, quantities, rates, retention and advance. Progress is recorded against each work order line by your team, or by the subcontractor through a secure portal link, and the cumulative quantity cannot go beyond the ordered quantity. RA bills are raised from that progress with retention held back, so the bill starts from recorded work instead of a fresh spreadsheet.
Payables show what you owe each vendor and subcontractor by age, and payment requests go through approval in finance and billing. CivilPilot does not calculate TDS or GST on RA bills; record those as your accountant advises. It works in a phone browser, so the site engineer can update progress from site.
