Late payment charge – customer says it’s not legal

Customer talking through their arse.

Posted under Late Payment

Posted by Alec at 8:06 pm, August 10, 2007

3 Comments so far

  1. Alec added on  August 11th, 2007 at 08:13

    I’ve been told by a few people that Direct Route won’t collect late payment charges on your behalf. They seem to collect them on their own behalf to fund their chasing of your original debt.

    They’ve also been known to wrongly tell people that they don’t have a right to charge the late payment charges.

  2. Alec added on  August 11th, 2007 at 11:06

    You can’t charge VAT on the late payment fee and the outstanding debt should include VAT to start with.

    Pedantic I know.

  3. Alec added on  August 12th, 2007 at 07:52

    I don’t think you can charge interest under the Act on overdue late payment charges, although you could possibly argue that the payment already received should be applied first to the penalty charges and interest and then to the original debt.

    We recently recovered around £2,000 in late payment charges from an ex customer. On top of that they must have paid more than that to DLA Piper to attempt to bullshit their way out of the liability. It was very satisfying when they agreed to settle at the last minute.

    My only regret is that for the first 6 months of our relationship with the customer we invoiced them monthly rather than weekly; that reduced the claim by about £1000.

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