Can i charge interest on overdue invoices in canada

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Customers Customer stories Customers love us Customer referral program. Breadcrumb Resources Finance. Table of contents. What should I do before charging interest for late payments on invoices? Is it legal to charge interest on overdue accounts? We can help GoCardless helps you automate payment collection, cutting down on the amount of admin your team needs to deal with when chasing invoices. Claiming Interest on Overdue Accounts.

Tuesday, June 27, Posted By:. Share and Subscribe:. By allowing a buffer, it shows the client that the vendor is reasonable. The pastries are for staff and clients. The payment terms indicate payment is due in thirty days. The thirty days goes by and no check. Now the question is, when should Pat start chasing her money? At least, not short term. Best practices would state that, for Pat, she should make a courtesy call a day or so after day 30, to her direct contact, which is Ian.

Pat does this, only to discover that Ian was sick for a week, right around the time she emailed her invoice. Then he was out of the country on business for ten more days, and as such her invoice was seriously delayed going to accounting. However, Ian has promised to look into it.

He calls back that afternoon and tells Pat he has put a rush on it, and apologizes for the inconvenience. She gets the check within 48 hours. In her message, she also lets Ian know she will re-forward the invoice, which she does in an email that afternoon. Nothing happens, and in the weeks that follow, there is still no payment.

At this point, Pat has done all she can. At the end of the 30 days, she applies the interest charge and resubmits the invoice.

Yes, there is nothing stopping a vendor from charging interest on overdue invoices. The practice is legal.