Late payment recovery

When a business customer pays an invoice late, the law adds interest and a fixed sum on top, even if the invoice was paid in the end. In England and Wales you can usually claim for invoices paid late in the last six years, and many businesses never do. We work out what's owed across the whole ledger and prepare every claim, for a fixed fee agreed in writing.

Ask for a free ledger scan

What the law gives you

The Late Payment of Commercial Debts (Interest) Act 1998 applies to invoices between businesses, including public bodies, unless the contract gives its own substantial remedy for late payment. For each invoice paid late:

  • Interest at 8% over the Bank of England base rate, from the day after the invoice was due until the day it was paid. The base rate used is the one in force on 30 June or 31 December just before the invoice fell overdue, and the rate stays fixed until it's paid.
  • A fixed sum per invoice: £40 on invoices under £1,000, £70 from £1,000 to under £10,000, and £100 on £10,000 or more. If your reasonable costs of recovering the debt are higher, you can claim the difference too.
  • Six years back. In England and Wales, invoices paid late in the six years before a claim is made usually still count. Different time limits apply in Scotland.

On a ledger with hundreds of late invoices, the fixed sums alone add up quickly. It's money you don't have today and aren't counting on. You know the total before you spend anything, and our fee is fixed, not a share of what comes in.

A Commercial Payments Bill now before Parliament would change some of these rules for future contracts. It isn't law yet, and it doesn't change claims you already have.

Who we work with

Insolvency practitioners

The claims belong to the company, so in an administration or liquidation they're an estate asset, unless the debts were factored or sold. Our fee is fixed and quoted in writing after the free estimate, paid upfront or against a purchase order. As we're not associated with your firm it would normally be a Category 1 expense under SIP 9. If an estate would rather have cash now, we can price the claims for assignment.

Accountancy practices

Introduce a client, with their permission, and we'll scan their ledger. If they go ahead, we share a fifth of our fee with your practice, and the client is told about it.

Businesses

It's most worth doing where the relationship has ended, the customer is a public body, or you invoiced weekly or in high volume. You decide which customers, if any, to pursue. Our fee is fixed, quoted in writing after the free estimate. We pursue debts owed by companies, LLPs and public bodies, not by individuals or sole traders.

How it works

  1. Send us a sales ledger export from Xero, QuickBooks, Sage or any accounts package, as a CSV or spreadsheet.
  2. Within 48 hours we tell you our estimate of the total that's claimable and how many invoices it covers. That part is free.
  3. If you want it pursued, we quote a fixed fee in writing. You sign a short engagement letter and pay the fee upfront, or send a purchase order. We go through each customer's terms with you, then prepare and send the letters before claim.
  4. Your customers pay you directly, into your own account. We never hold your money, and everything recovered is yours to keep.

If a customer won't pay, any court claim is yours to bring, yourself or through a solicitor, and we give you the figures and evidence for it. Court fees are yours to pay. Your ledger is used only to work out the claim. See our privacy notice.

Ask for a free ledger scan

Email your ledger export, or just a question, to Ben. We'll come back within one working day.

ben@reliness.co.uk