At this time of year, we see many suppliers contacting us about money they are owed from Christmas parties. For these companies it seems the festive hangover has lasted longer than is reasonable so we have put together a handy guide to how companies and business that are owed money from the Christmas period can recover it.
The type of company affected can range from event caterers to drinks suppliers and venues amongst others.
Communicate with the debtor
The first step you should always take is to write a letter to the debtor, this letter should outline the debt owed, what it is for and by when you expect to receive payment. If you have any evidence, you should include copies of this as well.
If you still fail to receive payment you can use the government website Money Claim Online for a debt of up to £100,000. This service requires a fee and the costs can be found here. The forms and detail you enter will then be sent on to the debtor.
Interest and additional fees
For business debt you can charge additional fees such as interest and late payment charges.
Once judgment is granted in your favour, an interest of 8% per annum is applied from the date of judgment if the debt is above £5000 and from the date of the Writ if below £5000.
Debt recovery costs:
- Up to £999.00 you can charge £40.00
- £1,000 to £9999.99 you can charge £70.00
- £10,000 or more you can charge £100.00
County Court Bailiff or High Court Enforcement?
Once you have your judgment you can then instruct a bailiff, if you have a judgment debt of under £600 your only option is to instruct a county court bailiff. A county court bailiff can only recover debts of up to £5,000 so if you are owed more than this the High Court will be your only option.
The county courts can often have a backlog of cases to deal with so if you want swift action and your debt is at least £600 then the High Court option is often the quickest way to recover money you are owed.
The forms to instruct can be found here.
High Court Enforcement
The fee to instruct us is £66 (this fee is then added to the total debt due). This is to obtain the writ of control and you’ll need to complete the transfer up form which can be found here.
We will then carry out the enforcement process, keeping you informed as to our progress. You can find out more information about the process outlined here in our FAQ section.
David is an authorised High Court Enforcement Officer and our Director of Corporate Governance