A holdback is a portion of the purchase price retained by the buyer (rather than paid to the seller at completion) to cover potential indemnity claims, working capital adjustments, or other post-completion liabilities. Holdback periods in Australian sub-$20M deals typically run six to eighteen months.
Holdbacks differ from escrow in that the funds are retained by the buyer directly rather than held by an independent third party. This is generally less seller-favourable because the buyer can effectively withhold release.