Viewed as a penalty

I can think of few things that aggravates my clients more than when I attempt to charge interest - they see it pretty much as a penalty and it as about as popular as a parking ticket - it also doesn't sit well with keeping customers good will - I only really use it a debtor is seriously late and I am about to sue them anyway. Basically its about perception.

Another problem is that they claim that they were previously unaware of the debt and blame us for not chasing it up before (claim they did not receive statements)and refuse to be "penalized for our inefficiency"

Any thoughts on this dilemma?

Thank you.

Dear Patrick

One of the saving graces is that you have a limitation period of six years in which to make your claim. It is therefore at your discretion when to claim in this period.

If a client pays on the basis of who shouts loudest then its prudent to be really hot on your chasing. There's loads of useful tips on the site that may help you get money in quicker.

Regards



Chris

Thanks for a quick response; on that note of six years, it is six years from the day the debt became due (invoice date plus 30 days) or six years from the date on the invoice? very much on my mind as I taking over the books and have discover several unpaid invoices dated 30/7/04.
Also you don't seems to mention the small claims court - I presume I should put a claim in fairly soon in case (as happened recently) they avoid the debt knowing full well in a few weeks there is nothing I can do about it. And yes, I do know this should have dealt with sooner.

Regards,

Patrick.

Dear David,

First of all, congratulations on this vastly improved website/service. Just hope doesn't become too tedious. What I quote on some of my letters chasing payment is this from the legislation as very few customers seem to be familiar with it let alone its niceties:

"Where there is an agreed credit period, where a supplier has agreed, either in writing or orally, a credit period with the purchaser, the payment is late if it is made after the last day of the credit period.If no credit period has been agreed, then the Act sets a default period of 30 days after which interest can run. This default period does not constitute a statutory credit period. Where no credit period is agreed in a contract, the principal debt will still become due from the moment the goods are delivered or the service performed."


Therefore I am assuming, providing my invoices then issued did not state payment was due in less time, the date after which my debtors can tell me to go to hell (for my invoices dated 31/7/04 plus 30 days - is 30/8/10) not that I intend to leave it that long, but with much to do in the interim I need to what point to work back from. Correct - or am I being thick?


Regards,

Patrick.