Also known as an ‘outstanding payment letter’ or ‘debt recovery letter’, a tried and perfected late payment letter template is a handy tool to have on file.
Here’s our guide to writing a polite nudge, clear reminder and final notice – check what works for you and start cutting down the chasing emails.
Most of the time, late payment can be easily settled with a quick email to your customer, gently reminding them that payment is overdue. When that doesn’t work, however, or you get no response, a letter in the post can help to formalise the situation. Make sure you’ve got an up-to-date address for correspondence, and keep a copy and record of everything you send and receive.
To get you started, here’s a quick run-down of what an outstanding payment letter should include, when to send a ‘nudge’ and how to take further action, if necessary.
Hopefully you’ll only ever need to send one polite nudge for late payment. But if not, you may need a couple of other templates to get the message across, including a firm reminder and a final notice letter.
These are the basic details each letter needs to include:
Here’s a late payment letter template, giving a reminder of the amount outstanding and due date, plus next steps.
You’ll need to edit this according to your business and circumstances, for example it might be more appropriate to mention a specific invoice that hasn’t been paid, rather than an overdue account balance.
Choose to download your template now, or get it directly from Farillio’s site where you’ll also get access to their full suite of customisable legal templates.
It’s worth staying up-to-date with Simply Business, as we’re always checking the most recent legislation and guidance for small businesses, especially when it comes to finance and legal issues. Subscribe to our monthly newsletter and check our legal and finance hub for regular updates.
Still having issues? Invoice financing experts Aldermore Bank work with small businesses every day to shelve the headache of chasing up late payments. Use our quick late payments form to get a quote from them today, using the ‘Invoice financing’ option when choosing from the menu.
And finally, you can get a lot of insight from gov.uk, especially when it comes to late payments, debt recovery and due compensation. Take a look at their hub for all the latest legislation, for quick reassurance of your rights and the proper procedures.
Remember, this article is just a guide, and it's always worth seeking professional legal advice.
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