When does an overdue account become a debt?

We're all different, and we all work on differing systems and principles, and an overdue account is often dependant on the working relationship with the customer. But when does an account become a debt? Is it at the end of the contract? Is it dependant on the age of the account? After 120 days when a relationship has broken down? Or is it when the account is on stop? But when does it go on stop? Should it be at day 31? For some companies an account never goes on stop.

Most companies used to class an account as a debt at 90 days, but we have found this is reducing to 60-80 days. The trust which was held in companies to pay has diminished. Clients are saying they are being told, 'you'll get paid when we get paid'. This is unacceptable, you can't rely on others to effectively pay your invoices, you have no control. It's a necessity today that cash flow is as vital as building and concreting relationships.

An account is a debt after the period of your terms and conditions has expired, and whenever you class your account as a debt we are here for advice and help. The old practice of being flexible with accounts has gone. Too many companies have paid the heavy price for that and attitudes have changed, even since last year. We all need to treat each account individually, and an assessment needs to be done at an early stage or you will get caught out. Leaving an account overdue by 10 days without giving your customer a call may have an effect on whether or not you receive payment at all. You will not be the only company owed money.

Should you require any assistance or advice with your overdue accounts please call Stacey Hodgson on 0845 862 1655 or This e-mail address is being protected from spambots. You need JavaScript enabled to view it .