Late Payment Guide for Maintenance Companies
Know your rights, charge what you're legally owed, and follow a clear 3-step process to recover late payments across maintenance jobs — without burning customer relationships or paying a solicitor.
What's included
- Your statutory rights under the Late Payment of Commercial Debts Act 1998
- Default payment terms and what applies if nothing is agreed in writing
- How to calculate statutory interest (8% above Bank of England base rate)
- Fixed late payment compensation amounts by invoice value
- Step-by-step 3-stage recovery process (reminder → letter → court)
- Template reminder invoice text for 7 days overdue
- Template formal letter before action for 21 days overdue
- Prevention tips: deposit upfront, payment link on completion
Guide preview
Late Payment of Commercial Debts Act 1998
This Act gives you the automatic right to charge interest on late business-to-business invoices. It applies even if your contract doesn't mention it. Consumer (B2C) work is covered under different rules.
30-day default payment terms if nothing agreed in writing
If you haven't agreed payment terms in writing, the default is 30 days from the invoice date (or delivery of goods/services, whichever is later). Always confirm terms in your quote.
Statutory interest: 8% above Bank of England base rate
From the day after payment was due, you can charge 8% above the Bank of England base rate. On a £2,000 invoice at today's rates, that's roughly £0.53/day — it adds up.
Fixed late payment compensation amounts
On top of interest, you can claim fixed compensation: £40 for invoices up to £999.99, £70 for £1,000–£9,999.99, and £100 for £10,000+. You don't need to go to court to claim these.
Reminder invoice at 7 days overdue
Send a friendly reminder with the original invoice attached: "This invoice is now 7 days overdue. Please arrange payment at your earliest convenience." Keep a record of the date sent.
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