Late invoice paid but refusal so far to pay interest and compensation

Hello ProcServ

I presume you have made a charge for interest and compensation for the unpaid invoice? If not follow the instructions here:

payontime.co.uk/users-guide-to-the-late-payment-of-commercial-debts-interest-act-1988

Late payment is calculated in the following format: Debt times interest rate divided by 365 times the number of days late

Example below:
Debt is £1,000 Inc VAT
If this debt is 30 days late, then the interest owed is: £1,000 x 8.5% = £85.00 (the annual rate)
£85 ÷ 365 = 23.29p (the daily rate)
23.29 pence x 30 days = £6.99 (the interest owed to date)

So as each day passes and they don't pay, the interest rate goes up by 23.29p per day.

If you wanted to collect this payment from the debtor then you can use either money claim online or a reputable debt recovery agency. I recommend the latter. Then your claim will be for the principal owed, interest, compensation and the cost of the debt recovery agency.

The debtor cannot refuse to pay the interest and compensation. It is statutory law!

You might want to point out to your debtor that under the legislation, you can also claim interest and compensation on all the past invoices that were paid late going back 6 years.

David J