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My client paid very late but refused to pay interest

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3 years 4 months ago #2241 by nona
I am self-employed and one of my larger payments from a client in 2013 was paid very late. I'm not fussed about a smaller payment being paid a few days late, but this was a big one. The payment terms were 45 days. The original invoice of just over £1,000 was paid about 11 months after the invoice date, but I also billed the company for the interest accrued plus £70 in compensation, with reference to the late payments act.
I sent a statement of account in 2013 and also requested that they pay interest and £70 in compensation in 2013. This resulted in the original invoice amount being paid (very late), but they never paid the interest or compensation.
Is there a letter template I could use to request (again) that they pay the interest and debt recovery compensation for the very late payment. I had already made such a request in 2013 but since they ignored my request for interest, I need to contact them again, in a more formal way. Is there a template I could use to claim debt recovery compensation and interest specifically (the original invoice amount has already been paid).
The timescale should not be an issue as I understand that I have a right to claim statutory interest for late payment up to 6 years in the past.

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3 years 4 months ago #2242 by j.salmon@cpa.co.uk
Hi Nona,

There is no template letter per se. You can just right a letter notifying them that you are continuing your claim for £70 plus interest.

I presume the interest on £1000+ over 11 months came to about £80

If your claim is £150 in total per my rough calculation, so long as you continue to write then there is no issue of timescale.

Just because they paid the invoice, it doesn't negate the compensation and interest either.

Unfortunately the issue is one of practicalities. Given the relatively small sum due, there is a limit to the steps that would be cost effective to take.

If they continue to refuse to pay then you might want to consider issuing a claim in the small claims court via moneyclaim.

They will probably settle that rather than try to fight it.

Can I just say though that I am very glad to hear that you have decided not to drop it. We need more people to stand up for their right to interest and compensation if we are going to actually make a change to the late payment culture that persists at present.

We wish you every success

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3 years 4 months ago #2244 by nona

j.salmon@cpa.co.uk wrote: Hi Nona,

There is no template letter per se. You can just right a letter notifying them that you are continuing your claim for £70 plus interest.

I presume the interest on £1000+ over 11 months came to about £80

If your claim is £150 in total per my rough calculation, so long as you continue to write then there is no issue of timescale.

Just because they paid the invoice, it doesn't negate the compensation and interest either.

Unfortunately the issue is one of practicalities. Given the relatively small sum due, there is a limit to the steps that would be cost effective to take.

If they continue to refuse to pay then you might want to consider issuing a claim in the small claims court via moneyclaim.

They will probably settle that rather than try to fight it.

Can I just say though that I am very glad to hear that you have decided not to drop it. We need more people to stand up for their right to interest and compensation if we are going to actually make a change to the late payment culture that persists at present.

We wish you every success


Many thanks. Please could you advise how I could best make reference to the late payments act? What particular sections could I quote to support my claim?

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3 years 4 months ago #2247 by j.salmon@cpa.co.uk
Hi Nona,

I would simply refer to the entire act as it is the entire act that supports your claim. However if you wish you could refer to section 5A which states“(1) Once statutory interest begins to run in relation to a qualifying debt the supplier shall be entitled to a fixed sum (in addition to the statutory interest on that debt.)

(2) That sum shall be:-
a) For a debt of less than £1,000, the sum of £40
b) For a debt of £1,000 or more but less than £10,000 the sum of £70
c) For a debt of £10,000 or more, the sum of £100

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