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Late payment compensation per invoice or just one amount for the whole balance?

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13 years 5 months ago #434 by mseager
Hi all this is my 1st post have found most answers on this site thank you!
I am a subcontract engineer and have been supplying labour to a guy who owes me quite a lot of overdue invoices I have given him intill tomorrow to pay or I will charge him interest and compensation I just want to make sure I get it right!
I was invoiceing him on a weekly bases varying from £750 to £2000 do I charge compensation for each individual invoice or just one amount? And that would be £70?

Thanks in advance,

Marc

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13 years 5 months ago #437 by David J
Hello Marc
Apologies for a slow reply.

Compensation charges vary on the amount being claimed.

£40.00 up to £999.99
£70.00 up to £9999.99
£100.00 for £10.000 or over.

As to the question of compensation added to each invoice, or batching the invoices together and making one claim.... Well this has been debated on this forum with differing opinions.

Most seem to argue that you should make a claim for compensation on each invoice.

When the invoice amounts are small and interest low, it may seem unrealistic to to have say 3 invoices of £20.00 each then charge £40.00 for each one. In this case it may be fairer to batch the 3 invoices together and make one claim of £40.00.

The legislation states that you are entitled to 'reasonable compensation' which basically leaves the whole issue to personal judgement.

So charge what you think would be 'reasonable'.

Regards

David

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