Discover the time limit for claiming late payment compensation in the UK and how to start the process.

According to the Federation of Small Businesses (FSB), 52% of UK businesses experienced late payments in 2022.

Late payments can negatively impact your business, leading to cashflow issues, stress, and a drain on your resources. That’s why it’s critical that businesses understand what assistance is available to them under UK legislation.

These regulations protect traders working with public contracting authorities, ensuring they receive fair compensation for each late payment they receive. Unfortunately, many GB businesses simply aren’t aware of these safeguarding laws or don’t have the time to navigate complex claims processes.

That’s where we come in. is the UK’s leading public sector late claims specialist. Our team of industry experts have come up with a simple, four-step claims process to help your business claim the money it deserves without the hassle. Plus, with our no-win, no-fee approach, you can claim late payment compensation with peace of mind.

Start the claims process today.

This guide explores the late payment claims time limit, how to make a claim, and more.

Late Payment Compensation Claims UK: Rights and Regulations

There are several pieces of key legislation surrounding late payment in the UK. Namely, the Late Payment of Commercial Debts (Interest) Act 1998 and the Public Contract Regulations 2015.

The Late Payment of Commercial Debts (Interest) Act 1998 aims to deter late payments and compensate businesses that have received late payments from clients, such as contracting authorities.

It’s important to note that this Act only applies to the commercial supply of goods and services, and where there’s no provision for interest in your Terms of Business.

The Act means you can claim interest, compensation, and reasonable costs of collecting debt on every invoice that’s not paid on time.

The fixed compensation rate ranges between:

  • £40 and £100 per invoice up to £999.99
  • £70 for invoices up to £1,000 – £9,999.99
  • £100 for invoices over £10,000.00

Next up: How long do I have to make a late payment claim?

What’s the Time Limit For Claiming Late Payment Compensation?

There is a specific time limit for claiming late payment compensation across the UK. This timeframe varies slightly depending on your location.

Suppliers in England, Wales, and Northern Ireland have six years to make a late payment compensation claim. While in Scotland, they have five years.

These time periods are set according to case law and the Limitation Act 1980.

How to Know if Payment Is Late

As a general rule, compensation is usually payable from the end of the agreed credit period. 

If you’re supplying a public authority, interest is payable after a thirty-day window (even if you have agreed to a longer payment date)

This thirty-day default period starts running from either:

  • the date of delivery of the goods or services or;
  • the date the contracting authority receives an undisputed invoice

Our detailed guide covers everything about How to tell if a payment is late under UK regulations.

How to Make a Late Payment Compensation Claim

The first step is to ensure you’re eligible to make a claim for late public sector payments. You can do this by using our free Eligibility Calculator.

It’s a quick and easy way to make sure that you meet the requirements for late payment compensation claims.

Once you’ve confirmed your eligibility, you have two options:

  1. Go it alone
  2. Work with a late payment claims specialist

Unless you are very familiar with the legislation surrounding late payments, it’s best to work with a third-party service.

There are many benefits of working with specialist late payment services. Not only will it save you time, resources, and unnecessary stress, but their expertise will ensure you get the best outcome possible.

For instance, at, we’ve devised a straightforward and transparent four-step claims process.

This allows businesses to make a claim without dedicating time or resources. Our team of industry experts will handle the claim on your behalf, checking in regularly to update you on the process.

Discover our unique claims process today.

Next Steps

Claiming late payment compensation is your right and can protect your business from losses as a result of delayed income as well as future late payments. As such, working with specialists like can protect your business and help you get the compensation you deserve.

Start your claim now.


We’ve answered the most common questions about claiming late payment compensation in the UK.

What is a late compensation claim?

A late payment compensation claim gives UK businesses the right to obtain when they do not receive timely payments from contractors, such as the public sector. This process is regulated by the Late Payment of Commercial Debts (Interest) Act 1998 and the EU Late Payment Directive.

Read our comprehensive Late Payment Compensation guide for more information.

What types of businesses can make a late payment compensation claim?

All UK businesses, from sole proprietors to LLCs, can claim compensation in the event of late payment. However, this legislation does not cover personal debt.

What if a client has more than one overdue invoice? 

Your business can claim compensation for every invoice that has been paid late, provided it’s for a separate order of goods and services. You can add these amounts together and make one late payment compensation claim covering all costs. However, make sure you calculate each claim individually first and break it down for your client. This makes it clear which claim relates to which invoice.

Can I claim late payment compensation if I don’t have a legal contract with the client?

Yes, making a late payment claim is still possible even if you don’t have a formal contract with the client. However, this will be a more complex process. We recommend agreeing to terms up-front and having a formal contract with all of the payment terms in writing.

When do I consider a payment late under UK law?

Generally speaking, a payment is considered late when it exceeds the thirty-day rule. This rule states that all invoices must be paid within thirty days of receiving an undisputed invoice. However, it’s important to note that there are some circumstances where this rule might not apply. For instance, if you have a contract with the client that states a longer payment window. 

How can I calculate how much late payment compensation I am owed?

The easiest way to calculate how much compensation you’re entitled to is by using our free Claim Calculator.

calculator and invoices to calculate late payment compensationAre You Entitled to Late Payment Compensation?
legislation against late payments in the UKHow Is My Business Legally Protected From Late Payments in the UK?