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Letter Demanding Late Payment of Debt Fill out the template

Letter Demanding Late Payment of Debt

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Last revision Last week
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Last revision: Last week

Size: 1 page

Available formats: Word and PDF

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Letter Demanding Late Payment of Debt

This document is a letter demanding late payment of an outstanding debt and should be used by businesses who are owed payment by a customer who is a private individual, private business or public body, such as a local council.


What should be noted?

This document can be altered to be a general demand for late payment or a final demand for late payment before legal action will be taken. When a business uses this document to send a letter requesting payment for the outstanding debt they should make sure that the debtor has had reasonable to time to pay the sums due.

There is an option to include interest payable upon the outstanding debt. The interest charged can be set at any contractual rate or at the statutory rate of 8% plus the relevant Bank of England base rate. If the business sending this letter charges interest under their payment terms, or any contractual terms they have with the debtor, the statutory rate of interest cannot be charged on top of this.

Where the business sending the letter is charging statutory interest, they can also include any late payment fees which will be payable by the debtor and can specify whether the debtor will have to cover any reasonable costs the business has incurred in order to recover the debt.


How to use this document?


1. How to send this document?

This document should be sent to the debtor by the business once payment for any services or goods provided has become overdue.

Where the debtor is:

  • an individual the letter should be addressed specifically to that person;
  • a private business or public body the letter can be addressed to an individual employee that normally liaises with the business or it can be addressed generally to the business or public body that owes the debt.


The letter should be sent by an employee or person authorised to do so on behalf of the business. It should be signed and dated accordingly and a copy should be kept on record to prove that the debtor has been sent any reminder or final demand before legal action is instigated to recover the debt.

The letter can be sent to the debtor by post or by email.


2. How much time does the debtor have to pay once the letter has been delivered?

The period of time that the debtor has to pay the business should be stated in the letter. Where the business sending the letter does not have any specific payment terms, the payment will be treated as late if it has not been received 30 days after receipt of invoice or the goods or services were received.

Once this letter has been sent, and there are no contractual terms or payment terms specified by the business sending this letter, the debtor will have 30 days to pay if they are a public body and 60 days to pay if they are a private business.

If the business sending this letter does have contractual terms or any relevant payment terms, the time the debtor will have to pay can be stated specifically in this document to reflect these terms.


3. What to do if the debtor does not pay after this letter has been delivered?

Where this letter is

  • a general demand for late payment and the debtor does not pay after receiving the letter, the business who has sent the letter can choose to send another letter to the debtor requesting payment and this document will allow the business to do this;
  • a final demand for late payment and the debtor does not pay after receiving the letter, the business who has sent the letter can engage with a solicitor to initiate legal action against the debtor to enforce payment of the debt through the courts.


Applicable Law

Late Payment of Commercial Debts (Interest) Act 1998

Late Payment of Commercial Debt Regulations 2013


Help from a lawyer

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The lawyer can answer your questions or help you through the process. You will be offered this option when you complete the document.


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