How to chase an overdue invoice (the right way)

overdue invoice header image

You’ve delivered on your work, set your payment terms and sent an invoice to your client. But the payment is overdue, and you haven’t received a response or update.

But no need to panic just yet! There are several ways to manage an overdue invoice, no matter what state your client relationship is in.

In this quick guide, we’ll cover how to get your invoices paid without burning client relationships, and make sure you get paid fast.

Table of contents

Setting expectations & charging interest

The best way to get paid for an overdue invoice is by avoiding them in the first place. This means not being afraid to set expectations from the beginning of your relationship with a client.

Start by outlining your payment terms from the first proposal you send to a client. By the time both parties are ready to sign a contract, there should be no surprises. Then, review these conditions during your kick-off calls and onboarding process. When setting these expectations, make sure you cover the following:

  1. How you send your invoices
  2. How your client can pay you
  3. When you send invoices (i.e. day of the month)
  4. Payment terms (e.g. NET 15 for 15 days)

Make sure to have your “accounting house” in order, too. If you’re constantly creating invoices manually and sending them via email every time, it can be hard to keep track. Instead, use a smart business account with integrated invoicing (such as Tide 😉), invoicing software like Wave, or the features built into  accounting platforms like Xero or Sage, to automate as much of your invoicing process as possible:

Overdue Invoice - Xero Template

Pro tip: Need the rundown of what should be included in your invoices? Check out our complete guide on how to raise an invoice.

You can also deter against late payments by including interest terms in your agreement. The law allows you to do this, thanks to the Late Payment of Commercial Debts (Interest) Act 1998.

This legislation allows you to claim up to 8% interest on unpaid invoices. Just make sure you make this absolutely clear to your client when beginning your relationship. For more information, check out this article from Pay on Time.

Finally, make sure the information you include on your invoice is correct. Incorrect information can cause delays or disputes, so always ensure amounts, dates and client details are accurate before sending.

What to do when you’ve not been paid

You’ve sent your invoice, and the client has missed the due date. The first important step is to keep calm. Sometimes, things slip through the cracks and people forget. A friendly reminder might be all that’s needed.

Make sure that first reminder is friendly. Remember, you don’t want to burn client relationships with harsh language. We’ll give you a template for this in the next section.

Don’t be too eager to follow up, either. If your payment terms are 30 days after receipt of invoice, don’t chase up on day 30. Wait a few days and then send that first reminder.

When reaching out, make sure you’re speaking to the right person. If the company you’re working with has an accounts department, ask your contact if it would be appropriate to reach out to them directly. Remember to include a copy of your invoice in each email.

If email doesn’t work, it may be worth resorting to a phone call. Pick up the phone and find out if your client received your previous emails. Ask them the following questions:

  • Did you receive my last email about the overdue invoice? (quote the invoice reference if necessary)
  • Do you have any issues with the invoice that we can address while I’m on the phone?
  • When do you think you can make the payment?

Always make a record of your correspondence (both email and over the phone). Include who you talked to, the date and time. This will be invaluable if you have to escalate things further. At some point, you may even have to hit “pause” on services rendered until the invoice is paid.

Email templates

Knowing how to communicate without burning your client relationships can be a delicate balance. Here, we share some templates you can use when reaching out and chasing late payments.

1. Less than two weeks overdue

Subject: Overdue payment ([YOUR COMPANY]) – [INVOICE REFERENCE]


I’m following up on invoice no. [INVOICE REFERENCE]. It was due for payment on [INVOICE DUE DATE] and I wanted to confirm you received it?

I’ve attached the invoice to this email again for reference. Could you please confirm the invoice has been scheduled for payment?

Many thanks,


2. More than two weeks overdue

Subject: Overdue payment ([YOUR COMPANY]) – [INVOICE REFERENCE]


Further to my previous email, I’m reaching out regarding outstanding invoice [INVOICE REFERENCE] / [INVOICE BALANCE].

As the invoice is overdue, could you please give an update on payment status. If there are any issues, such as information missing, please let me know and I’ll send over an amended invoice.

I’ve attached the invoice to this email for reference.



3. Interest warning (30 days or more)

Subject: Overdue payment ([YOUR COMPANY]) – [INVOICE REFERENCE]


Further to my previous email, I’m contacting you again on behalf of [YOUR COMPANY] with regard to outstanding invoice [INVOICE REFERENCE] / [INVOICE BALANCE].

To remind you, as per our service agreement, we are entitled to charge X% interest per [DAY/WEEK] of invoice going unpaid. I’d love to avoid this, so if there are any issues please let me know. I’ve attached the invoice to this email again for convenience.



4. Final reminders (Extremely late invoices)

Subject: Final reminder ([YOUR COMPANY]) – Invoice [INVOICE REFERENCE]


Further to my previous email, I’m contacting you on behalf of [YOUR COMPANY] regarding invoice [INVOICE REFERENCE] / [INVOICE AMOUNT].

This invoice was due for payment on [DUE DATE] and remains unpaid.

As we’ve not heard from you, I’m afraid we will shortly begin legal proceedings in order to receive the amount owed to [YOUR COMPANY].

Immediate payment will result in us closing this issue without need for legal action. I’ve attached the invoice to this email for convenience.



The thought of seeking legal advice can seem overwhelming, and perhaps a little unnecessary. However, when it comes to monies owed and the cash flow health of your business, it’s simply a part of business.

Here, we’ll cover three approaches you can choose depending on your situation. However, this is to be used as a point of reference only. We highly advise you seek legal counsel from a professional solicitor before taking action.


At the first stage of the approach, it’s best to get into a room to discuss the issue and look for the best way to fix it. This mediation process allows the client to discuss any miscommunication issues, or address any internal problems that may have caused escalation head-on.

It’s also a much cheaper cost than legal proceedings. You can learn more about mediation over on the Civil Mediation Council’s website.

Statutory demand

This is a formal, legal letter sent to the client, which they have 21 days to respond to. If the letter is ignored, you can take them to court.

Ignoring a statutory demand has serious risks as it increases a company’s chance of being liquidated. If you do find you are being ignored, you can attempt to wind up a company if their debts owed are over £750. In a more serious effort, you can attempt to make them bankrupt if they have debts owed over £5,000. In both cases, you must be able to prove the company cannot pay their debt to you.

If you do file a wind up petition and a company ignores you, it will be listed in the Gazette and risks having its bank accounts closed and lines of credit denied.

As found on the GOV.UK website, you can send the statutory demand letter yourself, but you must be aware of all the (very strict) criteria required to make it upheld. Again, we highly recommend seeking legal advice before following this route yourself.

Court action

If the invoice hasn’t been disputed throughout the entirety of the process (including your email follow-ups), then you can take court action.

For claims under £100,000, follow the process online as outlined by the Justice Department. When going this route, you must be able to prove sufficient communication between you and the client.

If the client disputes your claim, then you may be required to attend court. Make sure you check out Money Claim Online (MCOL) guide from HM Courts & Tribunal Service to make sure you’ve collected and provided all the correct information.

To begin this process, follow the process on Money Claim Online. Once again, make sure you seek legal advice before taking any action.

Ways to reduce invoice follow-up stress

As we’ve just seen, chasing unpaid invoices can be quite stressful and lead you down serious legal avenues.

One way to reduce run-down stress is by automating the email follow up process. Through your invoicing software, set up automatic email sends every X days and let the system take care of the communication for you.

Alternatively, you can outsource the follow-up process to an invoice processing service. Rather than risking valuable time getting frustrated by unresponsive clients, let a professional service take the burden from you.

In both of these scenarios, you get to spend less time worrying about getting paid, and more time adding value to your business.

Wrapping up

Getting paid on time and chasing overdue invoices will be much easier by setting expectations in advance. Make your payment terms and invoicing process clear during your onboarding process.

When first following up on invoices, wait a few days before reaching out. Remember, things can slip through the cracks, so a friendly reminder is usually all it takes. If you need to remind them further, use the email templates provided.

And while legal action is sometimes needed, it’s unlikely you’ll need to go down this route.

Photo by Bruce Mars, published on Pexels

Shahree Zin

Partnerships Executive and small business accounting advocate

Tide Team

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