Which Time Limit Applies?

Hi all

I'm a new Sole Trader, and have encountered my first late paying client.

The standard terms for people in my position supplying services to such companies is 30 days, and this is what I have listed on my invoice.

However the information on this site says that the March 2013 amendment to the legislation requires that "The public sector must pay within 30 days and private sector within 60 days".

I'm not clear therefore which time limit applies before I am entitled to make a claim for the compensation and interest. If it is 60 days, then is the 30 day stipulation in my invoices legally meaningless?

Thanks
Andy

Hi Andy,

If you haven't agreed payment terms in advance then we would say the default 30 days would apply.

The problem with terms on the invoice is that if you generally invoice at the end of a job, you are trying to introduce payment terms at the end of the job as well.

In an ideal world you would want to agree payment terms at the very *beginning* of any business relationship, prior to actually sending out the first invoice.

Hope that helps :)

Thanks, that makes sense, and I'll certainly keep in mind to avoid potential misunderstandings/assumptions by stating my payment terms in advance of a job in future.

In this particular case, it's a company that's booking my services on a daily basis, and since they've done so six times now (each agreed and invoiced seperately), I would take that as a tacit agreement with the terms on my first invoice (since they haven't disputed the terms at all, simply not paid).

Thanks
Andy

Hi Andy,

That would seem sensible. Good luck and let us know how you get on!