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Statutory Compensation for non payment

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13 years 4 months ago #227 by goldman
My understanding is once again being challenged so I am interested in people's responses.

If a company is owed £100 from another company and it relates to 5 invoicss each of £20, is the statutory compensation £40 or £200 i.e. 5*£40?

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13 years 4 months ago #231 by goldman
My view is that whilst "invoice" is never mentioned the reference is to a qualifying debt and a qualifying debt is defined by The Late Payment of Commercial Debts (Interest) Act 1998 and statutory interest is in reference to the relevant date of that qualifying debt. A relevant date could never be established in regard to the whole debt but only to each individual debt and therefore each invoice.

The only exception I suggest is when the contractual arrangement is one but the invoicing is in parts. So there is a moot point if the invoices all relate to the one contractual arrangement and the invoices are merely part invoicing for the one debt, then perhaps the qualifying debt is the sum of the invoices.

Well thats my view. Any contrary views please?

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13 years 4 months ago #244 by Safe_UK
If we were adding the charges to a client account we would add £40 and calculate the interest individually on each invoice.

We certainly wouldn't like to test the 5 X £40 costs on every invoice in court...

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13 years 4 months ago #268 by ashley smith
On the other hand I would charge per invoice, but retrospectively. But then I don't raise many small invoices as mine are generally in the Thousands.

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13 years 4 months ago #269 by ashley smith
On the other hand I would charge per invoice, but retrospectively. But then I don't raise many small invoices as mine are generally in the Thousands.

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13 years 4 months ago #275 by ninesquared
I'm in same situtation.

My invoices are not always per job but actually weekly to help client with cash flow, so personally I don't think you could charge per invoice unless it was specific to a project/order.

Having said that, it seems unfair that the client gets away with paying just one compensation for several late invoices.

Irrespective of this, do you think compensation can be charged retrospectively on invoices which have now been paid but were late, in some cases by 3 months

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