Late Invoicing

[KelvinJackson]

Hello, I wonder if somebody could help on the subject of late invoicing.

I am a freelance translator working for several clients. Whilst some of those clients pay automatically on completion of the work, others require invoices. To cut a long story short, I have been working incredibly hard over the last couple of years and neglected my invoicing. Over the weekend I finally got down to it and found that I have a backlog of over £50,000 with two clients.

Obviously, those clients are not going to be happy paying out a sum like that but I must collect it.

Firstly, what are my legal rights concerning invoices going back two years? Secondly, how do I approach my clients in the best way so that a payment arrangement can be agreed that suits both parties and doesn't result in unnecessary dispute, etc?

Any advice would be appreciated.

Kelvin

[Retrochic]

I would suggest a meeting with each client face to face and explain the situation. Admit you've been so busy you have let these Invoices back up and ask how payment will be made, and if necessary a payment plan can be devised . Basically they owe you the money if you have completed the work, therefore best scenario is that you can come to an amicable agreement on payment, worst scenario you have to take legal action, which will be pricey as its way over the thresh hold for the small claims court.

[RocW]

I agree with retrochic. A face to face meeting is going to be the best way to reach agreement with your clients. One would have thought that the clients would be aware of the fact that you had not invoiced them. If they are of any size, they would have (or at least, should have) included a provision for your invoices in their accounts. You must also consider the Income Tax/ Corporation Tax implications. You will have understated - and the cllients, if they have not provided for your fees - overstated profits. Presuming that you are registered for VAT (and if you can afford not to notice £50K turnover, it is likely that you are) you are invoicing some time after the tax point. If your clients cannot afford to pay your invoices in one hit, you need to set up a payment schedule, preferably by standing order/direct debit. Legally, you are entitled to the money but if you can come to an amicable agreement rather than having to go legal it would be better. If they are ongoing clients you are more likely to resolve the problem without dispute. Finally, schedule your time so that you ALWAYS raise invoices on a certain day of the month, whether your clients need them or not. I am glad I am not your accountant! Good luck with your negotiations.

[KelvinJackson]

Thanks very much for your advice, Retrochic and RocW, especially concerning the tax side of this - something else I need to consider. I signed up over the weekend with FreeAgent and will in future ensure this is dealt with, as you suggest, on a strict monthly basis.