Invoicing and payment timescale

[matthewstuart]

What is the legal time limit on when I am able to invoice for work that I have done, and the client has accepted AND used?

I did some work eight months ago and it was one part of an whole project that I have now invoiced for. The client is now saying that they might not pay it because they have used it and since it has served its purpose have subsequently forgotten about it!!

The whole amount that they are questioning is only £470 + VAT, but it is the principal of the thing to me. We have had a good working relationship for eight years, and I have always invoiced in a similar manner to keep paperwork to a minimum for both myself and my clients.

Thanks in advance.

 

[SOLO PLC]

Hi Matthew,

I had read your dilema, and had a quick chat to one of our accountants to see if we can offer any assistance at all. You have raised an invoice, so the non-payment should be noticed come your company's year end by your accountant/ bookkeeper and recorded in the appropriate manner, which sounds like potential 'bad debt'. You may want to discuss this with your accountant.

From reading various industry articles it seems that in the credit crunch/ recession people are holding back on payments for as long as possible, however unfair this may seem. I think there would be other factors to consider also, such as a whether you have a written agreement stating the terms and conditions for the project, especially with regards to payment, (however I am not a lawyer!)

As long as you keep aware, and are sure the person failing to pay up knows you remain aware, your invoice may still get paid, and I hope it does (although it could be as long as 18 months or longer).
Of course in an extreme situation you could contact a debt collector but this may prove costly and the moneys owed to yourself would have to justify it.

Anyway best of luck with your situation.

 

[Jenni384]

Matthew,
to my knowledge there is no legal 'you can't invoice after this date', especially given a year hasn't even passed yet.
From what you've said, you have a history with this client, you usually invoice in this way, and it sounds like they are trying to pull a fast one, possibly due to the credit crunch.
Invoice them, chase it as normal, but if you have any doubts get some legal advice. Limeone on here is excellent.

Good luck

 

[deniser]

The time limit for suing under a contract - which you would be doing here in the event that you pursued the payment - is 6 years.

 

[matthewstuart]

So, just to clarify here; I have up to six years before I loose my entitlement to invoice for any work that I have carried out. After that time, the client is perfectly within his/her rights to refuse to pay. Have I understood that correctly?

 

[SOLO PLC]

I'm not 100% sure but that sound very similar to something I did read ! I know it seems unfair, and unfortunately it would seem that a debt collector may be the only other alternative. Whatever you do, keep on top of this man for payments and use your company's contacts to ensure he cannot do this to someone again. I'm old fashioned and love the Name them and Shame them method of punishment!

 

[elaine@cheapaccounting]

What is the legal time limit on when I am able to invoice for work that I have done, and the client has accepted AND used?

I did some work eight months ago and it was one part of an whole project that I have now invoiced for. The client is now saying that they might not pay it because they have used it and since it has served its purpose have subsequently forgotten about it!!

The whole amount that they are questioning is only £470 + VAT, but it is the principal of the thing to me. We have had a good working relationship for eight years, and I have always invoiced in a similar manner to keep paperwork to a minimum for both myself and my clients.

Thanks in advance.

What do your terms and conditions say as regards raising invoices and payments?

 

[matthewstuart]

My TNC doesn't mention anything like that, it's more to do with the amount of time they have to pay upon date of invoice, how much interest will be charged and legal action taken if they don't pay up. Nothing in the TNC's covers the fact that they feel I have taken too long to invoice and are therefore not obliged to pay!

It'll go in there as of tonight tough.

 

[elaine@cheapaccounting]

That is pretty standard stuff to have in the T&Cs.

Why don't you post in the legal section and a legal bod can tell you the process for starting the debt recovery.

 

[KM-Tiger]

Clearly they are trying it on. They acknowledge that the work was done by admitting they have used it.

 

[taxattack]

What is the legal time limit on when I am able to invoice for work that I have done, and the client has accepted AND used?

I did some work eight months ago and it was one part of an whole project that I have now invoiced for. The client is now saying that they might not pay it because they have used it and since it has served its purpose have subsequently forgotten about it!!

The whole amount that they are questioning is only £470 + VAT, but it is the principal of the thing to me. We have had a good working relationship for eight years, and I have always invoiced in a similar manner to keep paperwork to a minimum for both myself and my clients.

Thanks in advance.

Your client's argument is frankly a joke. (The Limitations Act gives you 6 years). In view of your good working relationship I would suspect some kind of misunderstanding, or some desperation on their part.

How you proceed depends on whether you want to continue to do work for them in the future.

In the present climate it is more than ever advisable to send stage invoices, despite the additional paperwork.

Good luck

Chris

 

[credit control service]

Hi Matthew

You're better off involving a 3rd party in situations like this. It helps to protect your relationship with your client (do you want to be arguing over a debt one day and discussing new work the next), and it shows them you're serious about getting your money back.

There are specialist credit management companies out there including TAK who can collect your debt without charge to you (your customer pays interest and late payment fees to the agency). Get in touch if you'd like to discuss - google us for cotact details.

If you want to proceed with the debt yourself then there's a guide on our website under 'useful tools' which explains the process.

Jeremy
TAK-Credit Management