01604 420057

 

     

A highly experienced bookkeeping training and IT services team that will go the extra mile

How To Ensure You Get Paid Quicker - Part 2

Tips on avoiding the legal route ...

Click here to view a mobile version of this blog post  
 
 

POSTED BY ALISON MEAD ON 20/07/2020 @ 8:00AM

As a small business chasing debts myself, there is nothing more annoying than someone who just won't pay up. It is a frustrating experience and can be hugely damaging to the relationship with your customer ...

Before I go the legal route, I have one last try at chasing debts myself with a notice before action!

Before I go the legal route, I have one last try at chasing debts myself with a notice before action!

copyright: andreypopov / 123rf

You may have already read my previous blog post on chasing debts to help reduce the chances of having a bad payer, but in that post I mentioned the Notice to Action letter which I have used for those more stubborn bad payers.

"I was just on the verge of using a local debt collection service for 3 more stubborn debts a couple of years ago!"

This can be an excellent option for any small business woner, and I can certainly recommend a service if you need to use it, but as you pay a percentage of the debt collected I just wanted to have one last go at getting the money in myself.

The clients had ignored reminders and statements, and I must admit I was a little too chicken to call them myself so I used my Federation of Small business membership and designed a Notice to Action using the wording and advice found on their website.

The first thing to note is that emails are easier to ignore than post. We don't get much post these days so sending this as a letter with recorded delivery will definitely get noticed. It depends on the size of debt being chased as to whether you deem it necessary. If it's a small debt then an email with the wording changed and a read receipt will suffice.

"Also make sure that the notice is not the first time
you have chased them!"

Keep a record of when you have sent statements or reminders in the past so you can refer to them accurately in the letter. This will all help if you do have to go the legal route and seek professional help in getting the debt paid. Here is an example of the letter/email I use. Do feel free to copy and personalise for your stubborn debts.

Notice before action

We refer to our invoice number 6752 dated 5th April 2020 in the sum of £237.73. We also refer to our reminder email dated 2nd May 2020.

We note that the invoice still remains unpaid and the sum of £237.73 remains outstanding.

In the circumstances, we are now writing to formally demand payment of the amount detailed above within 7 days from the date of this letter/email. Should payment of the invoice not be forthcoming within this period of time, we will be passing our debts to a debt collection service and may issue civil proceedings against you without further notice.

We also put you on notice that we are claiming statutory interest under the Late Payment of Commercial Debts (Interest) Act 1998 at the rate of 8.25%, being the Bank of England base rate plus 8%, calculated on a daily basis from the date of the invoice as stated on the original invoice until the debt is paid. (Note You cannot claim statutory interest if there's a different rate of interest in a contract.)

If civil proceedings are issued against you, a claim will also be made for statutory interest on the amount outstanding calculated as detailed above and for our legal and court costs.

We hope that, despite the clear intention of this email, legal proceedings may be avoided and we look forward to receiving full payment within the time stated.

I found that in the case of the three clients I was chasing they all paid up promptly after getting this notice, and I didn't need to take further action.

Please, if you do use my template then do let me know if you are successful in getting your debt paid, or share your methods (hopefully none involving baseball bats) to help my other readers.

Until next time ...



ALISON MEAD

Would you like to know more?

If anything I've written in this blog post resonates with you and you'd like to discover more about chasing debts, do give me a call on 01604 420057, leave a comment below or use the Messenger tool you can see in the bottom right of your screen to chat right now.

Leave a comment ...

Share the blog love ...

Google AMP  /  Précis  

Share this to FacebookShare this to TwitterShare this to LinkedInShare this to PinterestShare this via Buffer

#GetPaidQuicker #PastDue #ChasingYourDebts #Bookkeeping #Training #UK

About Alison Mead ...

 

Alison loves bookkeeping. She has been helping clients to be better bookkeepers in Sage 50 for over 22 years and has more recently added Xero Accreditation to her list of skills.

She specialises in a very unique hand-holding method of training, helping bookkeepers and business owners to use their accounts software as and when they need support in setting up and producing their invoices, reports and financial information.

Alison combines her role at Silicon Bullet with running two network marketing businesses and is also a Regional Leader for 4Networking as she likes to keep busy.

You know what they say, if you want something done well ask a busy person!

Telephone:

01604 420057

Website:

https://www.siliconbullet.com