Fiducia TogetherEscrow and retention on a sale
Part of the price held back to cover warranty claims.
Please note: This page explains what a term means. It is general information, not legal, financial, tax or investment advice, and it does not know anything about your business. Before you sign, file or commit to anything, check it with an accountant, a solicitor, or the official guidance we link to.
What it means
An escrow or retention holds a portion of the consideration with a third party, or by the buyer, for a period after completion.
Why it matters
It gives the buyer a fund to claim against if a warranty turns out to be untrue, and it is usually the seller's main exposure after completion.
What it looks like in practice
Negotiate the amount, the period and the conditions for release. Warranty and indemnity insurance can sometimes replace it entirely, and is increasingly common.
What to watch out for
Retentions released only on the buyer's agreement, with no mechanism if they simply decline. Specify the release trigger.
Where to get proper advice
A corporate solicitor, and a broker for W&I insurance if the sums justify it.
Where to read more
Last reviewed 2026-08-28 by Fiducia Together · Next review due 2027-08-28
Please note: This page explains what a term means. It is general information, not legal, financial, tax or investment advice, and it does not know anything about your business. Before you sign, file or commit to anything, check it with an accountant, a solicitor, or the official guidance we link to.