Below-threshold contracts are public sector contracts worth less than the financial thresholds set out in the Procurement Act 2023. Because they sit below those thresholds, they follow a lighter set of rules under Part 6 of the Act — which makes them one of the best routes for smaller suppliers to break into public sector work. This guide explains what below-threshold contracts are, the rules that apply, and how to win them.
If you are new to public procurement, it helps to first understand what a tender is and how the wider Procurement Act 2023 works before you read on.
What are below-threshold contracts?
A below-threshold contract is a contract for goods, services or works with an estimated value below the Schedule 1 thresholds in the Act. These contracts are not classed as “public contracts”, so most of the Act’s heavier obligations do not apply. As a result, buyers have far more freedom in how they run the process.
That freedom is good news for suppliers. Buyers can invite quotes from selected suppliers, run a quick competition, or even restrict a contract to UK-based firms. Crucially, they can also prioritise small and medium-sized enterprises (SMEs) and voluntary or community organisations. So if you are a smaller supplier, this is often where your best early opportunities sit.
What are the below-threshold value limits?
The Act creates a specific category called a “notifiable below-threshold contract”. These are the contracts a buyer must advertise publicly if they choose to advertise at all. The values are:
| Type of buyer | Notifiable below-threshold value (inc VAT) |
|---|---|
| Central government (including the NHS) | £12,000 or more |
| Sub-central authorities (e.g. councils) | £30,000 or more |
These figures sit beneath the main thresholds for full “covered procurement”, which run into the hundreds of thousands for goods and services and millions for works. In short, below-threshold work spans everything from a few thousand pounds up to those higher limits.
What rules apply to below-threshold contracts?
The rules are lighter, but they are not absent. Two obligations matter most to suppliers.
First, transparency notices. If a buyer advertises a notifiable below-threshold contract, it must publish a below-threshold tender notice on the Central Digital Platform (Find a Tender) before advertising anywhere else. After the contract is awarded, the buyer must also publish a contract details notice. That means you can find these opportunities in one place.
Second, no separate suitability stage. Under Section 85, a buyer cannot run a pre-qualification stage to shortlist suppliers on suitability before tenders are submitted. In practice, that removes a common barrier. You are assessed on suitability at the evaluation stage instead, alongside your actual bid.
Why below-threshold contracts suit SMEs
Below-threshold procurement was designed to be accessible. The Act includes a duty to consider SMEs, and the lighter rules reduce the paperwork that often deters smaller firms. Because buyers can invite quotes directly, strong local suppliers with a good track record are well placed to win.
These contracts also build your public sector credibility. Winning a below-threshold contract gives you a reference, a relationship, and delivery evidence — all of which strengthen your next, larger bid. Many suppliers use them as a deliberate stepping stone toward framework agreements and higher-value work.
How to find and win below-threshold contracts
Winning low-value work rewards speed and clarity. A few priorities consistently pay off:
- Search the right places. Check Find a Tender and Contracts Finder regularly, and set up alerts so you never miss an advert.
- Register early. Learn how to become a government supplier and get your core information ready before you bid.
- Respond quickly. Below-threshold timescales are often short. Have your case studies, policies and pricing prepared in advance.
- Keep it proportionate. Answer exactly what is asked, evidence your claims, and stay concise.
- Build relationships. Buyers who invite quotes tend to approach suppliers they already know and trust.
If you want to convert more of these opportunities, a professional bid writer can help you respond quickly and score well. Our guide on whether a small business can win government contracts is a useful next step.
Frequently asked questions
What is the difference between below-threshold and above-threshold contracts?
Above-threshold contracts are “public contracts” that follow the full rules of the Procurement Act 2023. Below-threshold contracts fall under the lighter Part 6 regime, giving buyers more flexibility and reducing the burden on suppliers.
Do buyers have to advertise below-threshold contracts?
No. Advertising is discretionary. However, if a buyer chooses to advertise a notifiable below-threshold contract, it must first publish a below-threshold tender notice on the Central Digital Platform.
Can a below-threshold contract be restricted to SMEs?
Yes. Buyers can prioritise SMEs and voluntary, community and social enterprises for below-threshold contracts, and can also restrict some contracts to UK-based suppliers, provided there is no cross-border interest.
Is there a pre-qualification stage for below-threshold contracts?
Generally no. Section 85 prevents buyers from running a separate suitability stage to shortlist suppliers before tenders. Suitability is assessed at the evaluation stage instead.
Start winning below-threshold contracts
Below-threshold contracts are the most accessible entry point into public sector work — and a proven route to bigger wins. If you would like help finding and responding to them, our bid writing team can support you at every stage. Get in touch with Together: The Hudson Collective to start winning more, faster.
Source: GOV.UK — Below-Threshold Contracts guidance. This article is for general guidance and does not constitute legal advice.