Letter before action: the last letter before a court claim for an unpaid invoice

What is a letter before action?

A letter before action is the formal letter you send before taking someone to court over money they owe. For an unpaid invoice it comes after the reminders have stopped working, and it gives the customer one last, clearly stated chance to pay.

You will also see it called a letter before claim. They are the same letter. The court rules for debts owed by a person call it a Letter of Claim, which is the name to use at the top of the page.

What makes it different from a stiff reminder is that it has a form. The court expects certain things to be in it and certain enclosures to go with it, and it expects you to wait a set time for an answer. It is also the first message your customer gets that says what happens next, and by when.

Everything below is the law in England and Wales. Scotland and Northern Ireland run their own courts, with their own steps.

A reminder asks. A letter before action says what happens if the answer is still nothing.

Does it matter whether the customer is a homeowner or a company?

Yes, more than anything else in this post. If the customer is a person, including a landlord in their own name or a sole trader, a specific protocol sets out the letter and gives them 30 days. If the customer is a limited company, a shorter general rule applies.

The Pre-Action Protocol for Debt Claims covers “any business (including sole traders and public bodies) claiming payment of a debt from an individual (including a sole trader)”. That is a homeowner who owes you for a bathroom, and it is a sole trader who owes you for subcontracted work. It is not a limited company.

For a company, the Practice Direction on pre-action conduct applies instead. It asks for a letter with concise details of the claim, and expects an answer within a reasonable time: 14 days in a straightforward case.

Check the name you invoiced. If it says “Patel Lettings Ltd”, the debt is the company’s, whoever you dealt with on site.

When is it time to send one?

When the invoice is overdue, you have chased it more than once, you have tried a phone call, and the customer has not raised a problem with the work. At that point another reminder is only telling them they can keep waiting.

Before you write, check three things.

The invoice is right. The right name, the right amount, any part payment taken off. A letter that overstates the debt hands the customer something to argue with.

The due date has actually passed. If no date was ever agreed with a business customer, the law sets one: 30 days after they got the invoice. With a homeowner, it is whatever the two of you agreed, which is why terms on the quote matter so much.

You have the paperwork. The quote they accepted, the invoice, the dates you sent things, and what has been paid. The letter refers to all of it, and the customer is entitled to ask for copies.

How long should you wait before sending it? The rules do not say. They set the time the customer gets after the letter, not the time before it. Slow payers are not only small ones, either: the typical big UK company took 31 days to pay in the first half of 2026, from their own reports.

What has to go in a letter before action?

For a customer who is a person, the debt protocol lists it: the amount, whether interest is being added, what was agreed and when, how to pay, how to talk to you about paying, and where to send their reply. Three enclosures go with it.

If the job was agreed by word of mouth, the letter says who agreed it, what was agreed (in the words used, as far as you can remember them) and when and where. If it was agreed in writing, a signed quote say, the letter gives the date and says the customer can ask you for a copy.

The three enclosures

The Information Sheet is the court’s own explanation to your customer of what the letter means, with numbers for free debt advice. You do not write it or change it; you print it and put it in the envelope.

How to send it

Date it near the top of the first page and post it that day, or the next if you cannot. Post is the rule. You can email a copy as well, but email on its own is right only if the customer has explicitly asked you not to write to them by post.

A letter before action template for an unpaid invoice

Here is a letter of claim for a customer who is a person, built from the protocol’s list. Replace every bracketed field, delete the lines that do not apply, and keep it factual: the letter is evidence, so write it as if a judge will read it.

[Your business name]
[Your address, phone and email]

[The date you post it]

[Customer’s full name]
[Customer’s address]

Letter of Claim: unpaid invoice [number]

Dear [name],

I am writing about invoice [number], dated [date], for [the work] at [address]. It was due for payment on [due date]. The amount outstanding is £[amount]. [You have paid £[part payment] towards it, which is shown on the enclosed statement.]

The work was agreed in writing on [date of the accepted quote] between you and [your business name]. You can ask me for a copy of that agreement.
[Or, if agreed in person: The work was agreed on [date] at [place], when [who] agreed [what was agreed].]

[No interest or other charges are being added to this amount.] [Or: Interest is being added at [rate] a year from [date], and the enclosed statement shows it.]

You can pay by bank transfer to [account name], sort code [sort code], account [number], using [invoice number] as the reference. If you would like to discuss paying in instalments, or anything else about this debt, please contact me on [phone] or at [email].

I enclose a statement of your account, an Information Sheet and Reply Form, and a Financial Statement. Please read the Information Sheet, which explains your options, including where to get free debt advice. Please send the completed Reply Form to [your address].

If I do not receive a reply within 30 days of the date of this letter, I may start court proceedings to recover the debt.

Yours sincerely,
[Your name]

Enclosed: statement of account; Information Sheet and Reply Form; Financial Statement.

If the customer is a limited company

Write the same letter without the three enclosures, and set out the basis of the claim, the facts in brief, what you want, and how the figure is worked out. Give them 14 days to reply if the debt is straightforward. Late payment interest and the fixed recovery sum can apply between businesses; the payment terms guide has GOV.UK’s figures.

Can you add interest to the debt?

Often, yes, but say so in the letter if you are going to. From a business customer, the late commercial payment rules give you statutory interest and a fixed sum. On a court claim against anybody else, GOV.UK says the rate is usually 8%, and shows the sum.

GOV.UK’s method is three steps. Here it is for £1,240.00 that is 47 days overdue:

Small, on a small debt. The point of stating it is that the letter has to say whether interest or other charges are continuing, and a figure that appears for the first time on a court claim is one the customer was never warned about.

What happens after you send it?

The customer has 30 days from the date at the top of the letter. If they reply, you try to agree a way to pay. If they ignore it, you can start a claim. If they reply and you still cannot agree, give them 14 days’ notice before you do.

Take a letter dated Monday 2 November. The 30 days run to Wednesday 2 December, and the protocol tells you to allow for a reply posted near the end of them.

If the Reply Form comes back asking for time to pay, the protocol expects you to try to agree instalments based on what the customer can afford, and to give reasons in writing if you turn an offer down. If it asks for documents, you have 30 days to send them, and another 30 days then run before you can claim.

Making the claim

If it comes to that, you make a court claim for money at the county court, online or by post. Claims up to £10,000 usually go to the small claims track, which is designed for people who represent themselves. The fee depends on the amount, including any interest:

GOV.UK also points to mediation, which it says could be quicker and cheaper than a hearing. The court expects you to have considered it.

And if you skip the letter?

The court looks at whether both sides followed the steps in substance. It can order the side that did not to pay costs, or reduce the interest a successful claimant gets. Being owed the money does not excuse you from the letter.

What does Invoice Koi give you for the letter?

The paperwork it points at. The invoice with the date it was sent, the quote the customer signed if you took a signature, every payment with the day it landed, and a statement of the customer’s account as a PDF, which is the first of the three enclosures.

The statement is on the client’s screen. Pick a period (this month, last month, this year or everything) and it shows what was owed at the start, what was invoiced and received, and what is outstanding at the end, figures that add up. Choose everything for a letter, so nothing is left out.

Before it gets that far, the app does the chasing with you. An alert on your phone says when an invoice is overdue, once a day at an hour you pick. The invoice’s own button writes the chase, firmer once it is more than two weeks late, and hands it to your mail app. You press send; Koi never contacts a customer itself.

What it does not do

It does not write the letter. Use the template above, in your own words where it helps.

It does not add interest. No invoice or statement carries an interest line, so work it out as above and say it in the letter.

It does not log the chases. They leave from your mail app, so your sent folder is the record of when you chased. Keep it.

It does not post anything or count the 30 days. Put the date in your calendar the day the letter goes.

The earlier, friendlier messages are in the invoice email templates, and what belongs on the invoice in the first place is in the sole trader invoice guide.

Asked about letters before action