Final notice before referral, account 2214
Overdue payment notice
A plumbing business is owed $4,763 across three invoices, the oldest sixty six days past due. This is the last letter before the debt leaves the business, and it is written to be acted on rather than to sound threatening.
The document, page by page
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Section by section
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- Letterhead
- The trading entity, ABN, plumbing licence number and accounts contact, with the account number in the footer.
- Headline figures
- Amount overdue, interest accrued, total payable and the date by which a response is required.
- To and account
- The debtor company with its ABN and address, the account number, when it was opened and the trading terms.
- Invoices in arrears
- Three invoices with the work done, the issue and due dates, days overdue and the amount, totalled.
- Interest charged
- Per invoice interest with the days it is based on, the interest subtotal and the total payable today.
- How the interest is worked out
- The contract clause it comes from, the formula applied to one invoice and the daily accrual across all three.
- What has already been sent
- Five dated contacts with the outcome of each, including the call where payment was promised.
- How to resolve this
- Four numbered options: pay in full, agree an arrangement, dispute in writing, or say the business is in difficulty.
- If nothing is received
- Referral, recovery costs, supply stopping and the court that would hear a claim of this size.
- Credit reporting
- The possibility of a commercial credit bureau report, raised before the pay by date rather than as a threat.
- Ways to pay
- Transfer, card by phone and a payment plan, with how long each takes to clear and its effect on interest.
- Contact and closing
- The payment reference, how to get copies of the invoices, who to speak to, what to do if it is already paid, and the signature block.
Clauses in this document
What makes this document work
The interest is shown as a calculation
Amount, days overdue and the result for each invoice, then the formula written out on $1,485.00 at ten per cent over sixty six days. A debtor can check it, and the daily accrual of about $1.30 tells them what waiting costs.
The contact log makes the notice hard to dispute
Five dated contacts, including a phone call with a person named and a promise that was not kept. That table is what turns this from a first reminder into a defensible final notice.
It offers a way out before it threatens
Four numbered options come before the consequences, and one of them is a payment arrangement that stops interest. The notice also says no arrangement has ever been refused where the first payment was made.
Questions people ask
What should a final overdue notice include?
Every unpaid invoice with its due date and age, the total including any interest, the date by which payment is required, what happens if it is not received, and at least one way to resolve it other than paying in full today.
Can interest be charged on an overdue invoice?
Only if the customer agreed to it. This notice points at clause 7 of the credit application signed in March 2023, quotes the rate and the method, and shows the calculation per invoice so the charge is verifiable rather than asserted.
Can a business default list a company that owes it money?
Not under the consumer credit reporting rules. Part IIIA of the Privacy Act governs credit reporting about individuals, and the debt here is owed by Cobb and Marsh Bakery Pty Ltd, a company. Listing an unpaid company account with a commercial credit bureau depends on the bureau's terms and on the credit application, and it has to be accurate. The notice says exactly that, rather than citing Privacy Act conditions that do not apply.
What comes after a final notice?
Here, referral to a commercial collection agency with reasonable recovery costs added under the credit application, supply stopping, and possible proceedings in the Local Court of New South Wales, whose small claims division deals with claims up to twenty thousand dollars.
Why does the notice list everything already sent?
Because a final notice has to show the escalation was reasonable. This one lists the invoice, the reminders and the dates they were sent, before it sets out what happens next. If the debt is later referred or litigated, that list is the record that the debtor had a fair chance to pay.
Should a final notice explain how to resolve it?
Yes, and this one gives it a section before the consequences. Most overdue accounts are cash flow problems, not refusals. Offering a payment arrangement and naming a contact recovers more money than a referral does, and it costs nothing to put both options in the same letter.
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