Most freelancers have chased an unpaid invoice. Fewer know that UK law gives you real rights when a business pays late: interest, a fixed fee for the hassle, and a clear point at which an invoice counts as late. Here's what they are and how to use them without wrecking the relationship.
When is an invoice late?
If you agreed a payment date, it's late the day after that date. Between businesses, agreed terms must usually be within 60 days (longer only if it's fair to both sides). For public authorities it's usually 30 days. If you didn't agree a date at all, the law says payment is late 30 days after the client gets the invoice, or after you delivered the work if that's later.
What you can claim
Statutory interest
You can charge interest of 8% plus the Bank of England base rate a year on the late amount, unless your contract sets a different rate. To work it out: multiply the debt by (8% + base rate), divide by 365, and multiply by the number of days late.
A fixed fee for recovering the debt
- Up to £999.99 owed: £40
- £1,000 to £9,999.99: £70
- £10,000 or more: £100
You can charge it once per invoice, on top of the interest.
A chasing routine that keeps the client
- Before the work: agree payment terms in writing and put the due date on every invoice. Many freelancers ask for a deposit on new clients.
- The day after the due date: a friendly nudge. Most late payments are admin, not bad faith. Check it reached the right person.
- A week later: a firmer note mentioning that statutory interest and the fixed fee apply from now on.
- Still nothing: send an updated invoice with the interest and fee added, and a final date.
- Last resort: a small claim through the courts: Money Claim in England and Wales, the small claims process on nidirect in Northern Ireland, and simple procedure in Scotland.
Prevent it next time
Clear terms, deposits for new clients, staged payments on bigger jobs, and invoicing promptly all help. So does picking clients well: brands that are growing and have just committed budget, rather than ones hoping to squeeze one more favour out. That's where buying signals come in, and the day rate calculator helps you price so a late payment doesn't sink your month.