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How To Get Paid On Time

The whole point of running a business is to get paid, so unpaid invoices can be worrying and frustrating.

Refreshing your bank balance on the date the invoice is due and hoping you don’t have to get in touch with your client and ask them for money, is not a great attitude and we all need to become a bit more mature about talking MONEY.


Some people are anxious or embarrassed to talk about money but after a few late payers, I can guarantee you won’t be one of them! If you know the steps to take and what your rights are, you can minimise this happening.

Basic Steps of Getting Paid

  • You have a clear payment policy and terms within your contract.

  • You email new clients a copy of your T&Cs / contract and verbally outline your payment terms.

  • You invoice new clients on time, as per the time-frame stated within your T&Cs.

  • You retain open and regular communication with your clients

  • You ensure you’ve both agreed on the timescale and budget of each new project.

  • You know how much time they want you to spend, and they know how much their invoice is going to be.

  • Your payment terms are on each invoice you send out along with clear instructions on how to pay you.

  • You email a friendly reminder a day before the client’s invoice is due.

  • You let the client know their invoice has gone overdue a day after they’ve breached your payment terms.

  • You send your first formal reminder a week after their payment is overdue.*

  • You send your second formal reminder a week after the first.*

  • You send a final demand telling them you’re about to start legal proceedings to recover the payment.*

  • You follow through court action with PCOL.

*REMEMBER - calls are good but you need a paper trail



It all starts before the person has become your client. Vet your potential clients - make sure that the person you are working with is your ideal client and don't waste your time on someone who messes you around. Work with the people who appreciate you.

Any whiff of funny business or if you just don’t gel, say ‘thanks, but no thanks’.

Do your homework:

  • Check out their website / social media / reviews

  • What is their business and who are their clients?

  • Likewise, if they have come through as a recommendation or referral, get the details on how the mutual contact knows them – do they know them personally? Have they worked with them before and what was that like? How do you know the mutual contact and do you trust their judgement?

Outline the way YOU work from the outset:

  • How you operate and what they should expect from you (your client charter)

  • How you communicate and what your core working hours are (communication and boundaries)

  • How much you cost and how they should pay you (your fees)

  • When you will invoice them and when they should pay you (your terms)

Prevent issues and set expectations:

  • Clarify exactly what the task is that they need you to do

  • Clarify when the deadline is

  • Clarify the amount of hours and / or budget

  • Clarify if they want constant progress reports and how do they want them

  • Clarify how they want the task / project delivered

2. YOUR RIGHTS - according to HMRC

Your Right To Be Paid

You can set your own payment terms, such as discounts for early payment and payment upfront. Unless you agree a payment date, the customer must pay you within 30 days of getting your invoice or the goods or service.

Charging Interest and Compensation

The interest you can charge if another business is late paying for goods or a service is ‘statutory interest’ and this is 8% plus the Bank of England base rate for business to business transactions. You cannot claim statutory interest if there’s a different rate of interest in a contract.”

The Late Payment of Commercial Debts (Interest) Act of 1998 allows you to claim costs outlined in your invoice alongside any compensation. This means, even if it was not stated in your payment terms, you can get compensation against public sector organisations and businesses with more than 50 employees.

HMRC says you can also charge a business a fixed sum for the cost of recovering a late commercial payment on top of claiming interest from it. The amount you’re allowed to charge depends on the amount of debt, you can only charge the business once for each payment and you can currently charge £40 for debt up to £999.99.

See the full HMRC articles here Payment Obligations and Late Payment of Commercial Debts


If the amount owed to you is very low then you could just suck it up and learn from the experience. However, taking your case to the Small Claims Court is easily done online with Possession Claims Online (PCOL) and can cost as little as £25.

The costs of registering your claim online:

  • £25 for claims up to £300

  • £35 for claims between £300.01 to £500

  • £60 for claims between £500.01 to £1,000

  • £70 for claims between ​£1,000.01 to £1,500


My Own Experience

I’ve been on the fuzzy end of that lollipop - and it’s not as exciting as it sounds. My client was in debt to me of £1000, yet I still carried on working for them because in the back of my mind I was still earning money. And every time they assured me the money was on it’s way, I told myself it was the truth and I even thanked them for it.

What. A. Tool.

The real truth was that I was scared. I didn’t want to go to court and I didn't want to make them angry in case my money was gone forever. When I finally took a stand and stopped my services, they actually agreed that was a good idea - which really undermined my position and made me feel foolish.

It made me realise what they were doing was wrong and that going to court was my next move.

Having never done this before, I asked my business support group for advice on how to take a client to court.

But my client caught wind of this.

The money was in my account within 2 hours. No court action needed.

This was an experience I won't forget but now I have made the mistake once and I wont do it again. I now only work with people I can meet in person (this, for me, holds a lot of credibility) and preferably from a mutual networking group, so they have accountability.



Managing your clients and their expectations is a large part of owning a business, so deal with late payers professionally - don’t name and shame on social media and have procedures in place to avoid it in the first place.

You can take out a lot of hassle by only working with your ideal clients: setting out from the beginning what your payment terms are and agreeing with your client how much work you’re doing, at what rate, and over what time period. All before you start working with them.




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Claire x


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