When a customer will not pay, work the problem in calm, escalating steps: a friendly reminder, a firmer follow-up, a formal letter of demand, then small claims if it comes to that. Stay professional and keep records at every stage. Most invoices get paid at the reminder stage; the structure is for the few that do not.
The worst thing you can do is nothing, or fly off the handle. Here is the process.
Step 1: The friendly reminder
The day after the invoice is due, send a short, polite message: "Hi, just a reminder that invoice #102 for $1,450 was due yesterday. Could you let me know when I can expect payment? Thanks." Most late payments are oversight, not refusal. A nudge fixes them.
Step 2: The firmer follow-up
If there is no response in a few days, follow up again, attach the invoice, and state a clear new deadline: "Please arrange payment by Friday. If there is a problem with the invoice, let me know and I will sort it." Keep it civil but unambiguous.
Step 3: The letter of demand
Still unpaid? Send a formal letter of demand. It states the amount owed, what it is for, the dates, and a final deadline (commonly 7 to 14 days), and says you may take further action if it is not met. It does not need a lawyer, and the seriousness alone prompts many people to pay. Send it by email and post, and keep a copy.
Step 4: Small claims
If the deadline passes, lodge a claim through your state or territory's small claims tribunal or court. These are built for everyday disputes, the limits cover most trade jobs, and you usually do not need a lawyer. Bring:
- Your quote and the customer's acceptance
- The invoice and any reminders sent
- Job records, a job sheet, photos of the completed work
- Any messages showing the work was agreed and done
Good records are what win these, which is why you keep them on every job.
Prevent it next time
Chasing money is painful, so make it rare:
- Take a deposit. Money up front on bigger jobs protects you. See should you take a deposit before starting a job.
- Set clear terms. Put payment terms on every quote and invoice, for example payment within 7 days. A tax invoice generator keeps them consistent.
- Quote clearly. Disputes often start with a vague scope. A tight quote, with exclusions listed, removes the "but I thought that was included" argument. See how to write a quote that wins the job.
- Invoice promptly. The sooner you bill, the sooner you are paid, and the fresher the job is in the customer's mind.
This is general information, not legal advice. Debt recovery rules and small claims limits differ by state and territory. For your situation, check your state's fair trading or small claims body, or get legal advice.