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How to Effectively Chase Payment of an Outstanding Invoice

By Max. D Gray. Updated: January 16, 2017
How to Effectively Chase Payment of an Outstanding Invoice

Claiming a payment from someone who has not paid us may seem simple, but there are many ways to do this and not all are effective. There are some steps we can take to pursue collection before seeing a lawyer. The most important is to make a written claim in the form of a reminder letter, ensuring reception by shipping by certified mail or even registered fax if we want to record the contents of the letter.

Usually the first communication is friendly, since non-payment could be due to an error or an oversight. In other cases, you have to be aggressive starting from the first communication. There may come a time when we should demand payment on a specific date warning to undertake legal action in case of default.

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Steps to follow:
1

The first step is to check that the outstanding invoice is correct by checking your accounts, and the exact amount owed to you and make sure it is not a mistake or an oversight on your part.

2

Write a formal letter referencing the unpaid invoice. Include a breakdown of what the invoice is for, a due date, the exact amount, and indicate that you hope that it will be paid as soon as possible. You can use expressions like "you owe the amount of (...) E&OE (Errors and Omissions Excepted" to indicate that it might be a mistake on our part.

3

Send the letter by certified mail with proof of receipt to ensure it is correctly received by the recipient. Go to your nearest post office and send via recorded delivery.

How to Effectively Chase Payment of an Outstanding Invoice - Step 3
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4

Wait a reasonable amount of time, and if there is no response or follow up on the defaulted payment, write another letter demanding payment by a specific date. Warn them that in case of default you will take appropriate legal action to recover the debt.

5

Send the letter by registered fax or mail with the certificate of content and acknowledgment of receipt. That way you have a record not only of the correct or incorrect reception by the recipient, but also the contents of the letter. Do not worry if the recipient does not collect the registered fax, you already have proof of your effective extrajudicial claim which can be used in a future lawsuit.

6

If the default continues, go to a specialised lawyer in these matters. They will advise you on the most appropriate procedure to demand payment of the invoice.

If you want to read similar articles to How to Effectively Chase Payment of an Outstanding Invoice, we recommend you visit our Economy & business category.

Tips
  • If the unpaid bill is from a business and not an individual, you must first make sure that it is still active, because otherwise it will be very difficult to collect. In the latter case, see a lawyer to explore the possibility of deriving the responsibility for the debt default to the administrator of the society and lead a lawsuit against them.
  • Please note that claims can be made within a given period (usually three years). After this time they are no longer accepted.

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How to Effectively Chase Payment of an Outstanding Invoice
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