Builder's Playbook · England · UK01
Pricing a tender from a BoQ
Educational, not legal or tax advice. Check your contract, the tender documents and the current law (England and Wales).
5 points
Price every line net, at your own rates
Build each measured line from labour, plant and materials, or the subcontract price, before any markup. Use your own cost records and quotes; a software cost base is only a starting point, and published price data is licensed (practice). The bill is measured to RICS NRM 2 (2nd edition, effective 1 December 2021), which has 41 work sections.
Price preliminaries once, from the programme
Price site staff, set-up, temporary works and plant once, for the whole job, from your programme, not as a percentage on each trade; carry them in one place only; a preliminaries line on top of rates that already include them counts the cost twice (practice). NRM 2 puts preliminaries in work section 1, with a pricing schedule in Part B (RICS NRM 2, work section 1).
Add overheads and profit as visible layers
Keep your own risk, then overheads and profit, as separate, visible percentages on your build-up, so the tender review can change them on one page (practice). In the priced bill, show them the way the bill provides for them (NRM 2 deals with overheads and profit at §2.5.7).
Carry your own risk, not the client's
A client's cost plan carries the client's own risk allowances (the app's UK template has one called Design Development Risk). They are not part of your price. Carry only your own risk, sized from your risk register, and never pad it into the rates as well (practice). Where the client's bill has a risks section, price the risks it transfers to you there (NRM 2 §2.5 lists risks in a bill).
Tender sum without VAT, checked to the lines
Price the tender without VAT and say so on the form of tender; VAT is charged on each invoice (practice). For a commercial building the rate is the standard 20% (VATA 1994 s.2(1)); the zero rate for new construction applies to dwellings and certain relevant residential or charitable buildings (VATA 1994 Sch 8 Group 5). Before submission, check the lines add up to the tender sum.