Will You Ever solicitors

If you are a small business, you probably already have the opportunity to test out new legislation designed to ensure swifter payment of your invoices.

The phased introduction of the Late Payment of Commercial Debts (Interest) Act 1998 has meant that small businesses throughout the UK already have the statutory right to claim interest on late payment of commercial debts.

As from 1 November 2002 all businesses and public authorities will be able to claim interest from all other businesses and public authorities under this Act.

Who Benefits?

  • The provision applies to debts for supply of goods and services in a business to business transaction (not consumer sales).
  • A "small business" is one with 50 employees or less.
  • Interest runs from the day after the agreed date for payment, or if no date has been agreed then it is the later of 30 days after delivery or performance of the service or 30 days from invoice.
  • The rate of interest is 8% above base rate. Please note that it is not possible for a customer to exclude the right to statutory interest in the "small print" of his conditions of purchase unless there is some other "substantial remedy" available for late payment of the debt e.g. an alternative interest rate.

Interest on Late Payments

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