Orr Litchfield

Solicitors and Business Lawyers

Managing your business - Small businesses and late payments


In an average month 48% of invoices issued by small businesses in the UK are paid after their due date for payment and, on average, overdue invoices are paid 14 days late according to a recent study by Xero and Paypal.

The UK government has taken steps to try to tackle the problem of late payments through initiatives such as the Small Business Commissioner (launched in December 2017) but there remains a lot to be done in order to change the culture of late payments.

Small businesses in the UK had a combined turnover of approximately £2 trillion in 2018. 99.3% of all private businesses in the UK are small businesses (having less than 50 employees) and they employ around 60% of all private sector workers.

One of the greatest challenges facing those running small businesses is the culture of late payments, where the customers do not comply with the agreed payment terms of their contract. In many cases, this is not simply an inconvenience for the small business, it can have a domino effect by creating a cashflow problem resulting in the small business being unable to pay some of its suppliers or staff on time. In some cases, it may threaten the survival of the small business or bring about its closure.

By planning ahead, putting in place efficient and effective procedures and following those procedures, you can reduce your risk of no or late payment.

We can help you to put in place the correct contracts and procedures to improve your chances of being paid in a timely manner. When you are not paid what you are owed, we can help you collect your debts.

Need to talk?

If you would like to discuss your terms and conditions of contract (or those of any suppliers or customers), your contractual processes or any dispute, please contact us.

Whatever stage of the contracting or dispute process you have reached, we can help you to understand the process and to choose the option that is right for you and your business.

Contact us

If you would like more information or would like to discuss an issue, please contact us by telephone on +44 (0)20 3126 4520 or +45 38 88 16 00 or by email at enquiries@orrlitchfield.com

Back to News Home