# Liquidated Damages (LD) Meaning

> Liquidated damages are a pre-agreed charge for late completion, deducted from the final bill. See a mall example and how SuperWise tracks schedule delay.

Canonical: https://superwise.site/glossary/liquidated-damages/
Last updated: 2026-11-01

A delay charge fixed in the contract in advance, which the client deducts from the contractor when the project finishes late.

## What is Liquidated Damages (LD)?

Liquidated Damages (LD) are a pre-agreed sum in a construction contract that the contractor pays for each period of delay. If the contractor does not reach Practical Completion by the agreed [handover](https://superwise.site/glossary/handover-possession/) date and has no approved [Extension of Time](https://superwise.site/glossary/extension-of-time/), the client deducts the sum from the final bill, for example 0.5% of contract value per week, as compensation for lost revenue.

## Practical example

A contractor must finish a retail mall by 1 October so the stores can open for the Diwali shopping season. The contract sets LD at ₹5,00,000 per day of delay. The contractor finishes 10 days late. Without having to prove the actual loss in court, the mall owner deducts ₹50,00,000 from the contractor's final [RA bill](https://superwise.site/glossary/running-account-bill/).

## In SuperWise

SuperWise computes critical path dates for the schedule and shows the critical path in the Gantt. Each schedule approval saves a baseline, and each task shows its start and finish variance in days against the active baseline. The package-wise schedule summary report lists the delay in days for each package.

[Construction scheduling](https://superwise.site/features/construction-scheduling/)

## Related terms

- [Extension of Time (EoT)](https://superwise.site/glossary/extension-of-time/)
- [Running Account bill (RA bill)](https://superwise.site/glossary/running-account-bill/)
- [Handover (Possession)](https://superwise.site/glossary/handover-possession/)
- [Overrun (Cost & Time)](https://superwise.site/glossary/cost-overrun/)

## Related
- [Extension of Time (EoT)](https://superwise.site/glossary/extension-of-time/)
- [Running Account bill (RA bill)](https://superwise.site/glossary/running-account-bill/)
- [Handover (Possession)](https://superwise.site/glossary/handover-possession/)
- [Overrun (Cost & Time)](https://superwise.site/glossary/cost-overrun/)
- [Construction scheduling](https://superwise.site/features/construction-scheduling/)