Are you sick of chasing unpaid debts? Most businesses have been here and it can be very frustrating chasing down accounts who haven’t paid on time. Especially since your business’s cash flow and profitability may suffer.
But fortunately, there are many steps a business can take to recover unpaid debts and measures to reduce the chances of it recurring again.
Business debt recovery involves chasing down clients who have not paid for the purchased goods or services on time.
How to recover unpaid debts?
There are multiple steps you should take to recover any unpaid accounts, according to the Australian Securities & Investments Commission (ASIC), including the following:
The Letter of Demand
The Letter of Demand is the final issue of demand to an entity to pay the outstanding debt, otherwise legal proceedings will commence.
If you require a Letter of Demand, contact TY Lawyers as we can provide a professional level letter for $110 (including GST) addressed to your debtor to recover your unpaid accounts.
What to do when a customer refuses to pay debts?
If a customer refuses to pay the debt owed to you, it’s important to weigh up how much is owed vs the time, cost and effort it will cost you to retrieve the debt.
Generally, we see 80% of debtors respond to the Letter of Demand to avoid legalities.
However, if they still leave the debt unpaid, you may want to consider sending one more final short demand letter.
Once this has been ignored, you will have to file a statement of claim in court to recover the debt. The statement of claim sets out the owed amount and why the amount is owed.
From this point, court proceedings will commence, and it’s important to hire the expertise of an experienced lawyer from TY Lawyers. We will get your debt paid.
How to prevent future bad debts?
There are multiple safety nets to put in place to prevent bad debts, including the following:
These are all measures a business should have in place to prevent future bad debts.
Have bad debts? Or need help avoiding bad debts?
If a customer is refusing to pay you on time or at all, or you require help with implementing measures to avoid bad debt, then TY Lawyers is the right place for you.
We offer business debt recovery services, and conduct health checks on your business and recommend measures you should have in place. Contact our experienced lawyers by calling on (02) 8007 0135.