Firms urged to use time tracking and tackle late payments

Businesses are being advised to make the most of late payment legislation to claim interest and compensation.

Firms are entitled to claim interest and compensation when payments are not made within the credit timeframe stated on the invoice, highlighting the importance of keeping up-to-date with time billing and timesheets.

Yet just over a third of businesses taking customers through legal proceedings over late payments use this right, says debt recovery law firm Lovetts.

Ignoring the legislation can have a negative effect on small and medium-sized businesses, warns chairman and managing director of the firm Charles Wilson.

Compensations can be claimed on any invoice not paid within the given period with the amount based on how much the original charge was.

Firms have up to six years to claim compensation, even if the bill has since been paid.

Interest on late payments is charged at eight per cent above the Bank of England base rate.

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