Before you send or chase an invoice, you should double-check that you’ve included everything. You’ll need to re-invoice if you missed something out or made a mistake.
Your customer won’t necessarily tell you that they’re not paying because something is wrong with your invoice.
Sending a replacement can reset the clock on the time the business has to pay it. It’s usually worth discussing this with your client, as you might be able to persuade them to stick to the original due date.
What to include
GOV.UK provide details about the minimum you must include on every invoice. But there are other things you can add to help you get paid on time:
- the name of your contact
- your customer’s reference, for example a purchase order number
- a warning that you charge interest
Save a template to use every time you invoice, so you don’t miss out any of the essential details.
Create one that works for you, or download one of our examples.
Examples to download
Make sure you keep a copy for yourself if you send an invoice on paper.
Interest on late payments
The law on late payment means you can charge interest to businesses (but not consumers) as soon as their payment is late.
It’s good practice to state in your terms and conditions and on all your invoices that you’ll do this. You’re still entitled to do it though, even if you haven’t said you will.
A payment is considered to be ‘late’ after 30 days, unless you agreed something else with the customer. You’re also entitled to add compensation to the interest charge. This compensation (called a ‘debt recovery cost’) varies depending on how much you’re owed.
GOV.UK provides details on how to calculate interest and what compensation you can add to it.
An example of how you can say this in your terms and conditions and on your invoices is:
We will exercise our statutory right to claim interest (at 8% over the Bank of England base rate) and compensation for debt recovery costs under the Late Payment legislation if we are not paid according to our agreed credit terms.
Including this is a good way to encourage customers pay on time. It’s still up to you to decide whether you want to start actually charging interest in each individual case.
The relevant law this is based on is the Late Payment of Commercial Debts (Interest) Act 1998.