The credit management process
||Late Payment Fee
up to 30 days
up to 7 days overdue
up to 14 days overdue
30+ days overdue
|you can pay straight away
||no problem, these thing happen
||it's not too late to minimise costs
||houston, we have a problem
|I will send an
invoice to you for payment. If you have any questions about the invoice, get in
touch and we'll sort it out.
||I will remind
you that the invoice has not been paid and request payment within seven days or
agree alternative arrangements
||I will issue
another invoice for late fees, but I'll credit this invoice if you pay in full
within seven days.
||I will issue a second invoice for
late fees, and proceed with
recovery of the overdue balance
via HMCS without further notice.
For clients without a credit account or where payment is required in advance, I'll
issue a proforma invoice for some or all of the total amount. Once I receive payment
a formal invoice for that amount will be raised for your records and I'll be ready to
proceed with the project.
If I have agreed to offer credit facilities, you'll receive an invoice which you
can still pay straight away. I'll set a payment date of 30 calendar days for credit accounts, otherwise the invoice due date is set for three days following the invoice date. Keeping to the
agreed date is important if you need to continue using a credit account.
I'll normally keep you well informed of costs with quotations or project reports
before producing an invoice, so there should be no unpleasant surprises. But if you
have any questions about the invoice when you receive it, get in touch straight away
and we'll sort it out.
If the invoice remains unpaid after the due date, I'll send you a reminder along with
statement of your account. If you aren't able to settle the account straight away
then please get in touch to agree a payment date. You will need to do something
within seven days to resolve the account.
You'll receive reminders via email to your delegated accounts contact starting on the due date of the invoice. These continue every day until payment is received, you let me know that payment has been sent, or if I agree to defer the due date.
Late Payment Fee
Seven days after the reminder has been sent, if we haven't already agreed a
different payment date or if the new date has passed, I'll issue another invoice for
late fees (see below) and send a new statement with your new account balance. The
good news is that I'll credit this invoice if you pay the account balance excluding
these fees within seven days of the letter.
At this point, the invoice will have been with you for for as much as two months and will be
more than 30 days overdue. I'll have tried to resolve any issues with the invoice and
when it will be paid, now I'm fresh out of ideas.
I'll send one more letter together with a second invoice for late payment fees,
and proceed with a claim for recovery of the overdue balance shown on the statement
without further notice.
No further late payment fees will be charged. Interest will be claimed for from
the invoice date until the account settlement date, as well as any fees levied by
HMCS or their agents.
Late payment fees
From January 2015 late fees are calculated using the Late Payment Directive and
legislation* by the UK government. Late payment fees comprise of a
fixed amount plus statutory interest on the balance. Interest and fees are calculated
from the date of the invoice.
The fixed charge will be £40 below £1,000, £70 below £10,000, and £100 over
£10,000, and become due every 30 days from the invoice date.
Interest is calculated daily from the invoice date at an annual rate of 8% plus
the Bank of England base rate for business transactions.
*Late Payments of Commercial Debts (Interest) Act 1998, the
Late Payment of Commercial Debts Regulations 2002 and the Late Payment of Commercial
Debts Regulations 2013