Unpaid Invoice: What to Do, Step by Step, Short of Legal Action

What to do about an unpaid invoice depends on why it is unpaid: usually an oversight, occasionally a cash-flow problem on the client's side, and rarely a refusal. The steps below treat it in that order: confirm it landed, remind, restate the balance with the late fee your terms allow, pause the work, and send a statement. Each step has a tool on this site. This page stops where collections and legal action begin, which is a decision for you and, if it comes to it, a professional.

When	Do this	Tool
Day after the due date	Friendly note assuming an oversight; attach the invoice again	Email generator, "3 days past due"
7 days	Second reminder; restate number, amount, due date; ask for a payment date	Email generator, "7 days past due"
14 days	Name the late fee your terms allow and the date it applies	Email generator, "14 days past due"
30 days	Apply the fee; send the new balance	Late fee calculator
30 to 60 days	Send a statement showing every open invoice, the fee, and the balance	Statement builder, past due preset
60 days	Pause further work in writing	Email generator, "60 days past due"
After that	Final notice stating what your terms provide for	Email generator, "Final notice"

First, confirm it arrived

A surprising share of unpaid invoices were never seen: wrong address, a spam filter, a contact who left. The first note asks whether the invoice was received and attaches it again. Keep it short and assume nothing.

Remind, then restate

The 7-day and 14-day emails state the facts (invoice number, amount, original due date, days late) and ask one question: when will payment be sent. The email generator fills all of that in from the invoice details and escalates the tone by stage without threatening anything.

Apply the late fee, if your terms allow it

A late fee only holds up if it was in the terms before the work, as FreshBooks and every other source agree. If it was, the late fee calculator works out the figure for your structure, writes the line item, and hands it to the statement builder. If it was not, do not add one now; add the clause to future invoices with the clause assembler.

Send a statement, not another invoice

A billing statement shows every open invoice, the fee, and the running balance in one place. It reminds without demanding, and it is what a client's accounts payable needs to see to cut one check for several invoices. The statement builder's past due preset adds the aging table and the fee lines.

Pause the work

If your terms include a pause-work clause, use it, in writing, at 60 days: no further work is scheduled until the balance is settled. It is the most effective step on this list and it costs nothing. If your terms do not include it, that is the first clause to add for next time.

If the client pays the invoice but not the fee

Deposit the payment. Then decide: waive the fee and note it in the file, carry it forward on the next statement so it stays visible, or leave it as a condition of resuming work. Small fees are rarely worth a dispute; the point of the fee was to get the invoice paid, and it was.

If the client disputes the invoice

Ask which line, in writing, and settle that line. Ask for the undisputed balance to be paid in the meantime. Most disputes concern one item and dissolve once it is discussed.

Beyond this page

A collections agency, a demand letter from a lawyer, or small claims court are the next steps, and whether any of them is worth it depends on the amount, the relationship, and the cost of pursuing it. FreshBooks covers the general shape of that decision; this site does not give advice on it.

This guide was written by Ready Utilities. The escalation sequence matches the site's email generator and the late fee rules its calculator uses, and the disclosure-in-advance rule was checked against FreshBooks. The page stops at the point where collections or legal action begin and offers no advice on either.

Frequently asked questions

How long should I wait before chasing an unpaid invoice?

Send a friendly note the day after the due date. Most late payments are oversights, and the sooner the invoice is back on the client's desk the sooner it is paid.

Can I stop work on an unpaid invoice?

If your terms say so, yes, and it is the most effective step short of legal action. Say it plainly in writing: no further work is scheduled until the balance is paid.

Should I charge a late fee on an unpaid invoice?

Only if the fee was in your terms before the work. If it was, apply it at 30 days and show it on the next statement; if it was not, do not add one now.

What if the client disputes the invoice?

Ask for the specific line they dispute, in writing, and settle that line. Ask them to pay the undisputed part in the meantime. Most disputes are about one item, not the whole amount.

Should I send a statement or another invoice?

A statement. It shows every open invoice and the running balance in one place, and it is a reminder without being a new demand.

When is it time for a collections agency or small claims court?

That is a judgment about the amount, the relationship, and the cost of pursuing it, and it is outside what this site advises on. Everything above happens first.