Get in touch today
Call us on 07855 849232 or
email david.gordon@dg-law.co.uk
When you are a supplier, late payments have a terrible impact on your cashflow. However…
Some companies have been advised by their accountant not to pay invoices when they are due, and to wait until the last possible moment.
Some corporates have inefficient processes, where an inexperienced member of staff may perhaps file your invoice in a drawer instead of passing it to the accounts payable department.
Retailers and high street brands are often accused of taking too long to pay their suppliers.
Your rights
Your contract should state when payment is due. You can agree any payment terms you wish, but if it’s longer than 60 days, it must be fair to both parties.
If not made clear in your contract, the law says payment is late 30 days after the customer gets the invoice, or 30 days after you deliver the goods or provide the service (if that happens after the invoice is issued).
If a business owes you money for goods or services, you are legally entitled to claim interest and debt recovery costs under the late payment legislation.
Statutory interest
Unless stated differently in your contract, statutory interest is Bank of England base rate + 8%, so is currently 8.5%.
If your contract is with a public authority, you can’t charge less than that.
Debt recovery costs
You are also entitled to claim a fixed sum to go towards your debt recovery costs.
Up to £999 = £40
£1,000 to £9999.99 = £70
£10,000 or more = £100
Example
Let’s say a business owes you £1,000, and is 50 days late to pay:
You would write to your customer adding this amount to the original invoice.
Make it clear what will happen if they don’t pay. That is, that interest accrues daily and you will be forced to take legal action to collect the debt.
Call us now on 07855 849232 or complete our Online Enquiry and we will be delighted to talk with you about your legal matter.
DG Law were fantastic throughout our purchase process. We had a short, fixed, timeline to
DG Law supported us through a very difficult contractual negotiation to achieve exactly the outcome
We were very pleased with the way that DG Law helped us on our transaction
DG Law resolved a difficult lease renewal for us and their services were excellent –
I needed understanding and experienced legal advice. DG Law provided an excellent service at a
My experience was second to none – the service was professional and personal. DG Law
DG Law always step up to the plate on our transactions and handle the various
DG Law was recommended to me and my partner and I received excellent advice –
Having worked with DG Law a number/couple of times now, I have been really impressed
DG Law were constantly at hand, and kept pro-active throughout the thorny process of getting
DG Law came recommended to me and whilst setting up a new business it was
We were recommended three lawyers to handle the sale of our seven year old successful
We live by our core values of transparency, flexibility and being honourable – every day
We put ourselves in your shoes so we understand your problems from the inside out
We deliver our advice in a way that is easy to understand