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29 July

Combining late invoices together into a new one, Should you do it?

Most small business owners I know dread having to do debt collection with their clients. While cash flow is a major concern, the thought of messaging, sending a kind email reminder or picking up the phone to ask why a invoice has not been paid make ironing or going to the dentist more appealing.

Why is that?

When you are proud of your product or services, why do you find it so difficult to chase clients who fail to pay on time?

Can I just combine the old invoices into a new one?

A Facebook question that appeared on a group page of a Small Business Network

A Facebook question that appeared on a group page of a Small Business Network

This might seem like a good idea at the time, but will it encourage your client/s to pay any faster?

Some reasons why this is not the right choice to make:

  1. The customer might become confused as to what was due and what was not.
  2. You would be allowing a further delay for payment
  3. Consolidation will make it difficult to recover the unpaid invoices if you need to take legal action


How can you get paid faster?

  • Invoice on a regular basis
  • Clearly set your terms on the tax invoice,  including payment options and due date
  • Accept more forms of payment
  • Link a merchant account to your online accounting program like paypal or another credit card facility so clients can click and pay.
  • Charge a late fee or apply a discount for early payment
  • Charge up front for services and products
  • Monitor your debtors closely and act quickly when payments are late
    • Pick up the phone and call the customer as soon as their invoice is overdue to determine if they have a valid reason for not paying and negotiate a revised deadline
    • Send a kind reminder to them, stating when the invoice was due and the action you will take if still unpaid in X amount of days
    • Keep a record of all phone conversations, dates and reminder letters
    • Finally, when all of the above failes, send a letter of demand. In the letter of demand outline the following:
      • The amount due
      • The deadline they have to pay you by along with the date specified clearly in the letter
      • Outline the action you will take if the invoice is still unpaid by that due date
      • Post the letter by registered post to provide evidence that the letter of demand was sent
      • Keep a copy of the letter


Incorporate Automatic processes

If you use Xero, you can select automatic reminders, paste your letter of reminder templates and more.

MYOB and Quickbooks (Intuit) Solutions 

Both Myob and Quickbooks allow for merchant payment solutions with their online software programs

See more about M-powered invoices with MYOB or Myob Pay Direct 

Quickbooks can accept credit card and bank transfer payments linked via a button on your invoices you email out. See more Credit Card Payment Solutions 

What if all of the above fails to work?

You have three choices, either hire a debt collector, seek mediation or Start legal proceedings.

Remember in Queensland all debt collectors are required to be licensed. Ask your friends in business who they use, as word of mouth recommendations are often more effective in deciding on a debt collection service than going through the phone book randomly.

If you are uncomfortable with hiring a debt collector, you can seek mediation. This can save you time and settle the matter in a way to suits both yourself and the customer who has not paid you. If a solution is not reached, the magistrate will make the final decision for you both. See Queensland Government Abbreviated mediation for more details

You can file a small claims case at your local court house for all amounts under $25,000 or less. See QCAT for more details.

If you like our suggestions and would like to know more about My Office Books, please contact Amanda via our business page on facebook or ask a question by emailing us at


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