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Client refuses to pay late payment charge

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11 years 4 months ago #28 by work@simonantony.co.uk
Hi,

I've a client (who I am prepared to name and shame) that I provided services to but they continually paid late.

I eventually got paid but then used the power of the act to charge late payment interest which came to £256.29 in total for five invoices.

Since then and numerous emails, i've not managed to get them to pay - they simply ignore me and i'm sure they are just hoping I will go away.

What options do I have now? I can't afford lawyers so that is out, small claims court, winding up order etc??

Any suggestions welcomed

Regards

Simon

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11 years 4 months ago #29 by info@imgcouriers.co.uk
all the info I have read on this subject states "that it is difficult to get customers to pay late payment charges" as you are finding out

Maybe you should look at refusing credit and doing work only on a proforma basis? If this is feasible and is not going to cost you a customer.

I have a customer who imposed their own payment terms onto me and they continually pay late unfortunately it is only yourself that can decide the best solution.

A winding up order costs money, I believe. Certainly the info I found out about a Form 4 (I think) Statutory Demand For Payment which can lead to winding up costs depending on size of debt.

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  • Chris Harvey
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11 years 4 months ago #30 by Chris Harvey
Replied by Chris Harvey on topic Re: Client refuses to pay late payment charge
Dear Simon

I understand your problem because there is a cost benefit consideration here - the cost and time it would take to recover a relatively small amount.

Under the Late payment of Commercial Debts (interest) Act, you go claim interest and compensation retrospectively going back six years on invoices that have been paid, but paid late. So if they are a habitual late payer but the client relationship is important to you, you could leave it to a more appropriate time.

If you want to get the client's attention you can escalate things and look at legal options. In that respect do contact the Law society. They have a scheme called lawyers for your business. They have a network of over 1000 lawyers who are in the scheme. The short initial consultation is free and they can advice you on costs that would be involved.

www.lawsociety.org.uk/choosingandusing/helpyourbusiness/foryourbusiness.law

I hope that helps

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11 years 4 months ago #43 by fjs@aandesupport.biz
Hi Simon

The following link may be of interest.

www.moneyclaim.gov.uk/web/mcol/welcome

Regards

F J Steele

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11 years 4 months ago #45 by office@adminandsupportservices.co.uk
When the debtor part pays the outstanding sum (i.e. pays only the invoice and not interest or compensation entitlement) can the payment received be considered as full payment of interest, full payment of compensation entitlement and part payment of the invoice?

That way, surely you'd be allowed to carry on charging interest on the invoice value as it hadn't been paid in full.

Anyone like to comment?

Philip

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11 years 4 months ago #51 by David J
Hello Philip and thank you for your comments.

You are exactly right.
If an invoice is part paid (or the full amount of the invoice minus the compensation and interest is paid), then the interest and compensation are taken into consideration before the invoice amount. This would leave an outstanding amount owed on the invoice so interest continues at the daily rate on the full amount of the invoice until it, and any extra interest, is paid in full.

David

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