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Late Payment Information.

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Late payment information to help your business.

Late payments are a common headache for all businesses, regardless of size or industry. Nobody wants to be paid late and they definitely don’t want to spend time, money and resources chasing overdue invoices for products and services rendered.

On average a third of invoices paid to small business are paid late with an average invoice value of £6.142. This often causes considerable issues for small businesses managing their cashflow with over 20% of small businesses running into cash flow problems due to late payments.  

The government introduced legislation and created departmental bodies focusing on reducing late payments and support for small and medium sized business to boost their chances of getting paid on time.

If you are a business involved in a commercial transaction with another business (b2b), you need to know that: 

* Businesses must pay their invoice within 60 days (for private organisations i.e. PLC's, Ltd, LLP's) and 30 days (for public entities i.e. NHS Healthcare, Education, Local Authorities etc) unless expressly agreed otherwise and provided it is not unfair to the creditor. 
* Statutory interest rate applies (at least 8 percentage points above the Bank of England’s reference rate) to the debt unless an agreement has been reached which amounts to a substantial remedy for the late payment of the debt.

 

Larger business have further obligations in regards to reporting their payment practices and performance.

 

Any company which meets the below criteria has a duty to report -

If the company on their last two balance sheet dates, exceeded two or all of the threshold below -

* £36 million annual turnover
* £18 million balance sheet total
* 250 employees


These large companies must publicly report the average time they take to pay their suppliers so that potential suppliers are aware of their payment record and adherence to agreed payment terms. This allows small businesses to make informed decisions about who they do business with.

The Office of the Small Business Commissioner (OSBC) is an independent public body set up by Government under the Enterprise Act 2016 to tackle late payment and unfavourable payment practices in the private sector. The OSBC covers the whole of the UK - England, Wales, Scotland and Northern Ireland. The OSBC handles complaints from small businesses with less than 50 staff regarding any payment issues they may be experiencing with their larger business customers. The OSBC is impartial and free to use.

But where does Invoicey fit into all of this?

Did you know that you can claim compensation for any invoices paid late, dating back 6 years? Invoicey can help you recover compensation for invoices which were paid late.

Contact us today to start claiming compensation for your late invoices. There isn’t any catch - the government legislation covering late commercial payments entitles you to claim compensation and interest on any invoices which were paid late. You don’t need to have made the company aware that you are claiming compensation, just simply contact us and we will start the process for you. It’s quick, easy, and won’t cost you a penny.

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