Unpaid invoice and accounts receivable recovery

FAQ for Unpaid Invoice and Accounts Receivable Recovery

What is an unpaid invoice?

An unpaid invoice is a bill that has been sent to a customer or client for goods or services rendered, but has not been paid by the due date indicated on the invoice.

What is accounts receivable?

Accounts receivable is the money owed to a business by its customers or clients for goods or services that have been delivered or used but not yet paid for.

What can I do if a customer has not paid their invoice?

If a customer has not paid their invoice, you can take legal action to recover the outstanding debt. This may involve sending a demand letter, filing a claim in court, or engaging the services of a debt collection agency.

How long do I have to collect unpaid debts?

In South Africa, the Prescription Act sets out the time limits for collecting unpaid debts. The general rule is that you have three years from the date the debt became due to take legal action to recover it.

Can I charge interest on overdue invoices?

Yes, you can charge interest on overdue invoices. The interest rate must be reasonable and should be stated in your terms and conditions or on the invoice.

Can I recover my legal costs if I take legal action?

If you take legal action to recover an unpaid debt and are successful, you may be able to recover your legal costs from the debtor. However, this will depend on the specific circumstances of your case.

Can I use a debt collection agency to recover unpaid debts?

Yes, you can engage the services of a debt collection agency to recover unpaid debts. However, you should ensure that the agency is registered with the Debt Collectors Council of South Africa and complies with the regulations set out in the Debt Collectors Act.

Debt collectors and lawyers in South Africa specialize in debt collection and the legal aspects associated with debt recovery. Debt collection in South Africa is regulated by the National Credit Act of 2005 and the Debt Collectors Act of 1998. Debt collectors and lawyers work on behalf of creditors to collect outstanding debts from individuals or businesses. They handle various tasks in the debt collection process, such as tracing debtors, negotiating payment arrangements, initiating legal proceedings, and enforcing court judgments. It is important to note that debt collection practices must comply with the relevant legislation, including fair debt collection practices and consumer protection laws. To find more information about debt collection practices and regulations in South Africa, you can consult with a qualified attorney specializing in debt collection or refer to resources provided by regulatory bodies such as the National Credit Regulator.