When do I go for a County Court Judgement?
Over the last few weeks many of the conversations I’ve had with people asking for help have ended up with us discussing County Court Judgements and how little they cost as well as how they won’t take you an age to complete.
So when should you think about lodging a county court claim?
You need to think about the answer to the following questions:
1 – Is getting this invoice paid more important than working with this customer again?
2 – Have you got written records to that show the goods or services were requested and agreed by the client?
3 – Did you keep records detailing when you spoke to the customer about the outstanding invoice?
4 – During these conversations the customer has never queried the invoice, or the goods or service charged on it?
If you can answer YES to all of the above questions then maybe it is time to think about taking the debt to court.
How much will it cost you?
The government want businesses to be paid, they want to make it easy for anyone who is owed money to claim back this money. So they have set charges depending on how much the invoice is for. Invoices under £300 it will cost you £25 to complete a claim on line. Over £300 up to £10,000.00 there are varies bands with fixed fee charges, you can find out all about the Court Fees here. Over £10,000.01 up to £100,000.00 the court charge is 4.5% of the value of the claim to complete the form online. Over £10,000.01 you can not use the online service.
Can you claim anything else?
Yes is the answer to that.
If it is a commercial debt, then you can add interest as per the “Late Payment of Commercial Debt (Interest) Act 1998”. This allows you to add interest at the rate of 8% above Bank of England Base Rate. To find out more about how to calculate the interest, click here.
You can also charge an administration fixed sum for the cost of recovering a late commercial payment. For debt under £99.99 you can charge £40, £1,000.00 – £9,999.99 you can charge £70 and for debt over £10,000 you can charge £100.
How long does it take to complete an on-line form?
It takes around 30 minutes to complete an online form. It helps if you have with you at the computer all the information you have about the debt, the customer and the follow up conversations/calls/letters.
If your customer owes you money and it is more important to get paid than to work with them again – THINK about making a court claim.
Making a claim isn’t expensive.
Making a claim isn’t complicated.
Making a claim allows you to additionally charge for interest and administration.