Have you ever had payment issues when invoicing public sector clients? You’re not alone. It’s all too common for businesses to receive late payments from public sector clients, such as government departments, schools, hospitals, and other public bodies. Late payments disrupt cash flow, strain resources, and can ultimately hinder your ability to deliver quality services.

Nevertheless, there’s some good news: you don’t have to accept late payments from public sector clients as the norm. The late payment compensation scheme exists for this specific reason. 

This scheme allows you to claim compensation from public sector clients who fail to pay within the mandated 30-day timeframe.

By the end of today’s blog, you’ll be equipped with the knowledge and the tools to navigate invoicing public sector clients effectively. We’ll explore:

  • Who are Public Sector Clients? Understanding the landscape of public sector organisations in the UK.
  • Invoicing Best Practices: Crafting clear and accurate invoices specifically tailored for public sector clients.
  • What To Do if Late Payment Occurs: Your rights and options under the late payment compensation scheme.

By following these guidelines and utilising the resources offered by Late Payment Action, you can ensure timely payments and a healthier cash flow.

What Is a Public Sector Client in the UK?

Public sector clients are organisations that receive government funding. Here’s a breakdown of some of the most common types of public sector clients you might encounter:

  • National and Regional Government Bodies: This includes departments like the Department for Work and Pensions (DWP), the Ministry of Justice, and regional development agencies.
  • Local Government: District and borough councils, county councils, and other local authorities responsible for services like public transport, waste collection, and social care.
  • The National Health Service (NHS): Hospitals, clinics, and other healthcare providers funded by the NHS.
  • Education: Schools, academies, and further education colleges.

Key Steps When Invoicing Public Sector Clients

While the core principles of invoicing remain the same, there are some key differences to consider when dealing with public sector clients compared to private companies. 

Here are some best practices to ensure your invoices are processed efficiently and paid promptly:

1. Accuracy

Double-check all details on your invoice for accuracy, including your company name and contact information, a unique invoice number, and the date the invoice was issued.

2. Clarity

Provide a detailed breakdown of the goods or services provided, including clear descriptions, quantities, and unit prices. Don’t leave any room for confusion.

3. VAT

If applicable, make sure you clearly state the VAT rate and amount on your invoice.

4. Payment Terms

Explicitly state your payment terms, referencing the 30-day deadline mandated by the late payment compensation scheme.

5. Know Your Audience

Research the specific invoicing requirements of the public sector client you’re working with. Some may require purchase orders before work commences, while others might have specific formatting guidelines for invoices. If you’re unsure, contact their finance department for clarification before sending the invoice.

6. e-Invoicing

E-invoicing platforms are an excellent way of speeding up processing times. Many public sector organisations are now equipped to receive and process electronic invoices, streamlining the process for both parties.

💡 Read our comprehensive overview of the UK legislation surrounding late payment compensation.

How the Late Payment Compensation Claim Process Works

The process of claiming late payment compensation can be daunting and requires detailed knowledge of UK legislation. However, that shouldn’t put you off.

At Late Payment Action, we have created a simple, five-step process to help you get compensation without the hassle. Plus, our no-win, no-fee policy means you can make a claim with zero risk to your business.

Here’s how the late payment compensation claim process works.

Discover the full claim process 👉

Conclusion: Invoicing Public Sector Clients with Confidence

By understanding the ins and outs of invoicing public sector clients, adhering to best practices, and being aware of your rights when making a late payment compensation claim, you can significantly reduce the risk of late payments impacting your business. 

Here are some additional tips to ensure smooth sailing when invoicing public sector clients:

  • Be proactive: Don’t be afraid to follow up on your invoice after the due date. A polite phone call or email can nudge the payment process along.
  • Keep records: Keep copies of all invoices, purchase orders, and communication regarding the payment with the public sector client. This documentation is crucial if you need to make a late payment claim.
  • Build relationships: Taking the time to build a good working relationship with the finance department of the public sector client can be beneficial. This can involve introducing yourself as a new supplier, clarifying any invoicing requirements, and ensuring they have your correct contact information.

Remember, you are not alone in the fight against late payments from public sector clients. Late Payment Action is here to support you every step of the way.

Take action now with our Eligibility Checker 👉

Have more questions? Read through our FAQ page which answers all of the most common questions about the process, giving you a clear idea of what’s to come.

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