Fleet News

Tough new fines for late payments to hit industry

Fleets and leasing companies that are late paying their suppliers could face fines of up to £100 per invoice.

The new penalties arise from a decision by The Department of Trade and Industry (DTI) to increase the power of small and medium-sized companies to punish late bill payers.

In an industry notorious for its tardiness in regard to bill paying, creditors will now be able to charge debt recovery costs on a sliding scale from £40 for an invoice below £1,000 to £100 for those of £10,000 and above.

The penalties do not affect mutually agreed contract payment terms, although there is a grey area where the Government says many smaller companies suffer under 'grossly unfair' contractual agreements imposed by large corporations that use their power to dictate unreasonable terms and conditions.

The Government's Small Business Minister, Nigel Griffiths, said: 'Prompt payment can make the difference between success and failure for a small business.'

  • The DTI has produced a booklet detailing the new rules. To obtain a copy of 'A User's Guide to Late Payment Legislation' contact 0870 150 2500 or download it direct from the Better Payment Practice Group at www.payontime.co.uk
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