Not being paid for the goods and services you have supplied will impact on the cash flow and profitability of your business.

Establishing a process to deal with non-payment and recover debt is critical. It is also important that the process allows you to maintain a good relationship with your customers.

Consider the following options.

Get in touch with your customer 

Contact them as soon as their invoice is overdue to determine whether they have a valid reason for not paying. Try to negotiate a revised deadline for them to pay.

Send an overdue payment reminder

If you have not received payment within the timeframe outlined in your payment terms and conditions, or what has been agreed between the two parties, you can choose to send an overdue email to formally request payment.

You can create your own reminder or download and modify our sample overdue payment reminder email.

Send a letter of demand

If you still don’t receive payment, consider sending a letter of demand outlining the amount overdue, the deadline by which you expect payment and the action you will take if they fail to pay on time. Keep a copy of the letter and send it by registered post, to provide evidence if you need to make a claim in court. You can create your own letter of demand or download and modify our sample letter.


It is illegal to use methods that harass, coerce or mislead people about their debts. The Australian Competition and Consumer Commission (ACCC) have useful information about debt collection and your legal obligations.

Seek assistance

If your customer is another business or a government department, and they have not paid because of a dispute about the performance or supply of goods and services, you may consider using our dispute resolution service. This service provides a range of options to settle a dispute without going to court.

Hire a debt collector

A debt collector will act on your behalf to pursue a debt from your customer. They will charge a fee or a percentage of the total amount collected. In Western Australia, debt collectors must be licensed through the Department of Energy, Mines, Industry Regulation and Safety. Search for the debt collectors at the Institute of Mercantile Agents.

Start legal proceedings

You may need to take legal action if the debt remains unpaid. Some proceedings can be complex and expensive so first consider the:

  • likelihood of recovering the debt
  • time away from your business in pursuing the debt
  • associated legal and court costs

In Western Australia, the type of court to deal with disputes is based on the value of the debt.

  • Magistrates Court handles minor claims (debt or damages up to $10,000) and general claims (debt or damages up to $75,000)
  • District Court handles debt or damages up to $750,000
  • Supreme Court handles debt over $750,000

Read our guide on Recovering a debt through the Magistrates Court for more information

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Need help resolving a business dispute?

If you have any questions or would like to seek help to resolve a business dispute, our specialist business advisers can help.

Call us on 133 140