DEBT LETTER - CHARGING INTEREST ACCORDING TO LATE PAYMENT LEGISLATION

ABOUT DEBT LETTER DEBT LETTER - CHARGING INTEREST ACCORDING TO LATE PAYMENT LEGISLATION

WHEN TO USE THIS DOCUMENT

 This document is a letter which is demanding repayment of a debt due and is sent by a business who is owed money (the creditor) to a business who owes them money (the debtor). It can be for work and/or products supplied by that business.

 The letter is intended to give the debtor a final chance to make payment that is due but also warns that if they do not make payment, then the creditor will be issuing court proceedings to recover the money due. For this reason it is also called a “letter before action”.

 This letter can be sent by a creditor who is a business to a debtor is also a business because it allows the creditor to charge the debtor interest in accordance with Late Payment legislation. It also allows the creditor to charge the debtor the penalty or compensation payment because the payment due to the creditor is late.

THIS DOCUMENT CONTAINS THE FOLLOWING:-

 The document provides guidance as to the following amounts that can be charged:

• Interest
• Penalty or compensation payment because the payment is late

 The letter allows the creditor to specify:-

• What amount is due
• The date when it must be repaid by
• How it must be repaid (you choose, for example, to demand payment by bank transfer)

DO NOT USE THIS DOCUMENT IF YOU

• Your terms and conditions of business or the agreement specifies what amount of interest you charge for late payments (see our other documents).
• You are writing to a person, not a business (see our other documents).

HOW TO USE THIS DOCUMENT

 This is a MS Word document and is easy to use. The document uses blue text to provide extra guidance and notes and green text where you will customise your document to suit the circumstances in which it is used.
 

File Type: Word File