Source: https://www.quantsurv.com/library/definitions/retention-bond
Content format: Markdown version of the public page.
Content reviewed: 2026-10-10

# Retention bond

A separate security instrument that may replace cash retention on agreed terms.

by [Jack Butler-Kettle](<https://www.quantsurv.com/about#jack-butler-kettle>) · About 1 min readShare

## Further detail

Read this alongside [JCT explanation of retention and bonds in lieu](<https://corporate.jctltd.co.uk/whats-wrong-with-retention/>).

A retention bond may replace cash retention where the parties agree. It creates a separate security arrangement with conditions governing any demand. Amount, expiry, reduction, cost and wording all matter; the existence of a bond does not automatically release cash unless the contract provides for that.

Compare the proposed security with the subcontract and obtain advice on the instrument. [Retention tracking and release process setup](<https://www.quantsurv.com/claims?service=%2Fretention%2Fservices%2Fretention-loss-prevention#client-types>) can help identify the release and record-keeping arrangements.

## Sources

1.  [What’s Wrong with Retention? (JCT explanation of the 2016 forms)](<https://corporate.jctltd.co.uk/whats-wrong-with-retention/>). The Joint Contracts Tribunal.

[Browse the Library](<https://www.quantsurv.com/library>)