How to chase a late payment in the UK, step by step

To chase a late payment, check the invoice arrived, send a reminder the day after it falls due, ask for a payment date about a week later, then send a firmer letter. Those timings are our advice. For a debt owed by another business, gov.uk also lets you claim statutory interest and a fixed recovery sum on top.

When does a payment count as late?

gov.uk’s rules depend on whether a payment date was agreed. The table sets them out for each situation.

Use the later of the two dates. If you send the invoice before the work is delivered, the 30 days run from delivery. We would keep proof of both the delivery date and the day the invoice arrived.

In what order should you send the reminders?

The timings below are our advice, not a legal requirement. Change them to suit your customers. This is the order we suggest:

1. Check the invoice arrived. Keep the sent email or the portal receipt. It is the record you need if the customer says it never came.
2. Send a reminder the day after the due date. Give the invoice number, the amount, the due date and how to pay. Do not apologise for asking.
3. About a week later, ask for a payment date. A date gives you something specific to check on that day, even if the money has not arrived yet.
4. If nothing has arrived, send a firmer letter. Say which interest and fixed sum you intend to claim, if they apply, and the date you expect payment by.

What should the first reminder say?

Keep it short. Put the invoice number in the subject line, state the facts in one sentence and the request in the next. This is a hypothetical example for an invoice that fell due yesterday:

Subject: Invoice 1047 is now overdue

Hello,

Invoice 1047 for the inventory work was due yesterday. The amount is one thousand pounds, and the bank details are on the invoice. If you have already sent the payment, please tell me the date so I can check it.

Thank you,
[your name]

Read it aloud before you send it. If a sentence would sound odd on a phone call, cut it.

What can you claim on top of the invoice?

gov.uk says a business can claim two things when another business pays late for goods or a service: statutory interest, and a fixed sum for debt recovery costs.

Statutory interest is 8% plus the Bank of England base rate, for business-to-business debts. You cannot claim statutory interest if the contract sets a different rate of interest. gov.uk works through a debt of one thousand pounds on its interest page. If you decide to add interest to an amount already owed, gov.uk says to send a new invoice for it.

The fixed sum depends on the size of the debt. gov.uk sets three bands by debt size and lists the amount for each band on its debt recovery costs page. You can charge the business only once for each payment, on top of any interest you claim. A supplier can also claim reasonable costs each time it tries to recover the debt.

Take a hypothetical five-person lettings agency that has billed a letting company one thousand pounds for a set of inventories. That debt sits in the middle band, so its fixed sum is the middle amount on that page. Its interest is 8% plus the base rate on the day it calculates, so look up the current base rate rather than using one from memory. Check first that the client is a business, because these pages cover debts between businesses.

Can Kaer send the reminders for you?

Kaer can find overdue invoices in QuickBooks or Xero, which it works through its own browser, or in a spreadsheet export you attach, and draft a reminder for each one. The chasing guide describes the steps. You set the rules first: how firm to be, and any customer you want Kaer to leave to you. The guide’s example is a friendly nudge at 30 days and a firmer message at 60.

In a chat, each draft appears as a card, “Kaer wants to send mail”, showing the recipient, the subject and the message. You can ask for changes in the chat, then click Approve send or Deny. Approving only records your okay, so you then tell Kaer to send, and nothing goes out on a click alone. If you use Gmail, turn on sending under the connector’s optional write permissions first.

Once a run works, you can turn it into a workflow that repeats. You choose which steps run unattended and which wait for a person, and the approval step stays in place. The small business page says invoice chasing runs on a ladder of reminders that you set.

Which actions still wait for you?

By default, five kinds of action wait for a person: sending, paying, publishing, cancelling and merging. You can add more actions to that list. You can let a specific routine email through without approval once you have watched it work, but payments, cancellations and publishing stay gated whatever else you automate. The what Kaer will not do without you post sets out the list.

When is a spreadsheet enough?

If you send two or three reminders a year, a spreadsheet with a due-date column and a calendar reminder will cover it. Kaer is more useful when the same chase repeats across a long list every week, because finding the overdue items and drafting each reminder are the parts it takes off your hands. That is our view, not a measure of time saved.

What if the customer disputes the invoice?

Our advice is to stop the reminders once a customer disputes the invoice. A reminder cannot settle a disagreement about the work. Agree in writing what is owed, and reissue the invoice if it needs correcting. Start the sequence again from the new due date only if the customer accepts the corrected amount.

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