Invoice Law

ferdiaob

Hi guys,

Quick question really. Does anyone know if there is anything in law, that controls the minimum amount of time a customer has to pay an invoice issued by a business, to a business? Or indeed is there any general laws around this.

I know best practice is to give 30 days. I was wondering however, if there was actually any legislation about it?

Thanks in advance,
Ferdia

seamus

The Late Payments Directive 2002 gave companies the power to issue interest against late payments.

As a side consequence it legally defined a "late payment" as being one which is more than 30 days after the date of issue (unless otherwise agreed):

http://www.irishstatutebook.ie/2002/en/si/0388.html

“relevant payment date”, in relation to a commercial transaction, means—


(a) the date or end of the period for payment specified in the contract,


(b) where the contract does not specify the date or period for payment, 30 days after—


(i) the date of receipt by the purchaser of the invoice, or


(ii) the date of receipt of the goods or services where-


(I) the date of receipt of the invoice is uncertain, or


(II) the purchaser receives the invoice before the goods or sservices,


or


(c) where the contract does not specify the date or period for payment, if a procedure of acceptance or verification, by which the conformity of the goods or services with the contract is to be ascertained, is provided for by statute or in the contract and if the purchaser receives the invoice earlier or on the date on which such acceptance or verification takes place, 30 days after the date on which such acceptance or verification takes place;

Note that the regulations only apply to business-to-business transactions for more than €5.

While this isn't necessarily a "minimum" amount of time, it does a set a precedent whereby you can consider a invoice to be "unpaid" if the customer hasn't paid within 30 days.

ferdiaob

Thanks Seamus. We have a company we deal with that like to threaten termination of service if each invoice isn't paid within 5 days. This is written in the original invoice each month, talk about being polite eh? We were getting a little tired of it

Ferdia

stomprockin

On a similar note,

I received a call this week saying i owe 32 euro on a bill from 21 September 2010, almost a year ago. I'm going to pay tomorrow but can't help think of the check. a year!? would i have the right to refuse does any one know?

seamus

ferdiaob wrote: »

Thanks Seamus. We have a company we deal with that like to threaten termination of service if each invoice isn't paid within 5 days. This is written in the original invoice each month, talk about being polite eh? We were getting a little tired of it

You need to read the act really. I'm not a solicitor. It would seem to me that unless they state those payment terms beforehand, then the words written on the invoice are meaningless.
However, one could suppose that if you are aware that this vendor has terms this strict and you continue to deal with them, then you have implicitly accepted these payment terms and are bound by them.

I would very explicitly ring them up and negotiate clear payment terms, get it in writing, then you don't have to worry about what the invoice says.

stomprockin wrote: »

I received a call this week saying i owe 32 euro on a bill from 21 September 2010, almost a year ago. I'm going to pay tomorrow but can't help think of the check. a year!? would i have the right to refuse does any one know?

The debt is valid for 6 years, afair.

stomprockin

seamus wrote: »

You need to read the act really. I'm not a solicitor. It would seem to me that unless they state those payment terms beforehand, then the words written on the invoice are meaningless.
However, one could suppose that if you are aware that this vendor has terms this strict and you continue to deal with them, then you have implicitly accepted these payment terms and are bound by them.

I would very explicitly ring them up and negotiate clear payment terms, get it in writing, then you don't have to worry about what the invoice says.

The debt is valid for 6 years, afair.

Thanks seamus.