What to do when a client won't pay: a step-by-step plan

Published 26 September 2026 · Freelancing and getting paid

Most late invoices are paid after a clear reminder. Most of the rest are paid once the client sees a date and a consequence. This plan takes you from a polite nudge to a formal demand, one step at a time, without damaging the relationship before you need to.

First, check the basics

• Did the invoice reach the person who actually pays, such as accounts payable, with any purchase order number they asked for?
• Does it show the amount, what it is for, the due date and how to pay? If the terms say net 30 or end of month, the invoice due date calculator gives the exact date.
• Is there a complaint about the work you have not answered? A dispute needs a conversation first, not a reminder.

Step 1: a friendly reminder on the due date

Send a short, neutral email on the due date or a few days before. Assume it was missed, attach the invoice again, and say how to pay.

Subject: Invoice [number] due today

Hi [name],

A quick reminder that invoice [number] for [amount] is due today. I've attached a copy in case it went astray. You can pay by [bank transfer / card link].

Thanks,
[your name]

Step 2: a firmer reminder a week later

Ask a direct question. A question needs an answer; a statement is easy to ignore. If you can, also call or message the person who approved the work.

Subject: Invoice [number] is now 7 days overdue

Hi [name],

Invoice [number] for [amount] was due on [date] and I haven't received payment yet. Could you let me know when it will be paid? If there's a problem with the invoice, tell me and I'll sort it out.

Thanks,
[your name]

Step 3: pause work, if your contract allows it

If you are part-way through a project or on a monthly retainer, say that new work will pause until the account is up to date. Check your contract first: the free retainer agreement includes a clause that allows it.

Step 4: a final notice with a date

About two to three weeks after the due date, send a final notice by email and by post. Give the amount, the dates of your earlier reminders, a pay-by date seven to fourteen days away, and exactly what you will do next. Only name a step you are really prepared to take.

The free payment reminder letter does this: switch on final notice and it adds the earlier reminders and your next step.

Subject: Final notice: invoice [number], [amount]

Hi [name],

Invoice [number] for [amount] is now [number] days overdue, despite my reminders on [dates]. Please pay by [date]. If I don't receive payment or hear from you by then, I will [send a formal demand / start a small claim]. The attached letter has the details.

[your name]

Step 5: add interest or late fees you are entitled to

If your contract has a late payment interest clause, apply it and show the working. In the UK, a business owed money by another business can claim statutory interest at 8% above the Bank of England base rate, plus fixed compensation of £40, £70 or £100 depending on the size of the debt, even without a clause. In the US it depends on your contract and your state's law.

The free late payment interest calculator works out both.

Step 6: send a formal demand letter

If the final notice is ignored, a demand letter, also called a letter before action, is usually the last step before court or a collection agency. It should state the debt, how it arose, what you have already done, and a final date to pay. In England and Wales, if the client is an individual or sole trader, the Pre-Action Protocol for Debt Claims applies: the letter must include certain information and give them 30 days to reply.

Use the free payment demand letter template and the guide on how to write a demand letter for unpaid invoices.

Step 7: small claims, mediation or collections

• Small claims court. In the US, each state sets its own limit, typically somewhere between $2,500 and $25,000. In England and Wales, claims up to £10,000 usually go to the small claims track, and you can start one online.
• Mediation. Cheaper and faster than a hearing, and it keeps the door open for future work. In England and Wales, most small money claims now include a free telephone mediation session.
• Collection agencies. They usually keep a percentage of what they recover, so they suit larger debts you have given up collecting yourself.

Can I keep the files until they pay?

If your contract says ownership passes only on payment in full, the client does not own the work until they pay, and holding back final files is usually fine. Taking down a live website or disabling something you have already handed over is riskier, so get advice before you do that. See the intellectual property clause.

Stop it happening next time

• Take a deposit before you start, often 25% to 50%, and bill larger projects in milestones.
• Put the due date, late fees and your right to pause work in a written payment terms clause.
• Make ownership pass only on payment in full.
• Agree a kill fee for cancelled work.

The free freelance contract templates include these terms, and you can fill them in online without uploading client details.

General information, not legal advice. Debt recovery rules differ between countries and states.

More on freelancing and getting paid

• How to write a freelance contract: 10 clauses that prevent disputes
• What to include in a statement of work (SOW)
• Quote vs estimate vs invoice: what is the difference?
• How to write an invoice: what to include and how to number it
• What is a kill fee? How to set one in a freelance contract
• How to write a demand letter for unpaid invoices
• What is a change order? How to handle scope changes
• What is a credit note? When to issue one, what it must say

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