Quick answer
Send a friendly reminder on day 1 overdue, a firm follow-up at 7 days overdue, and a formal notice at 14–21 days overdue. Most invoices clear at the first or second stage. If you reach the formal notice stage and there’s still no response, escalate after 60 days — small claims tribunal for amounts under your state’s limit (typically $10,000–$25,000) or a debt collection agency for larger amounts.
Note: this is general business guidance, not legal advice. For significant debts or contractual disputes, talk to a lawyer or your state’s small business commissioner.
The tone problem (and how to fix it)
Most freelancers and sole traders sabotage their own follow-ups by being too apologetic. “Sorry to bother you, just checking if you got a chance to look at that invoice…” tells the client this is optional. It isn’t. They received a product or service; payment is the agreed return.
The right tone is professional but firm. Assume the best (busy client, missed email) at stage 1. Be direct at stage 2. Be formal at stage 3. No apologising at any stage.
Stage 1: Friendly reminder (Day 1 overdue)
Send this on the morning of the day after the due date. Don’t wait a week. A one-day-late reminder signals that you keep close track of your invoices — which itself encourages future on-time payment.
Subject: Invoice #[0042] — gentle reminder Hi [Client name], A quick reminder that invoice #0042 for $[amount] was due yesterday. It may have slipped through; if so, no problem — please process it at your earliest convenience. Bank details for reference: Account name: [Your business] BSB: [BSB] Account: [Number] Reference: INV-0042 Let me know if there's anything I can help clarify. Thanks, [Your name]
Stage 2: Firm follow-up (Day 7 overdue)
A week late and still nothing. Drop the “may have slipped through” framing. Be matter-of-fact and ask for a specific commitment.
Subject: Invoice #[0042] — overdue 7 days Hi [Client name], Following up on invoice #0042 for $[amount], now 7 days overdue. I haven't received the payment yet and wanted to check in. Could you confirm: 1. The expected payment date, or 2. Whether there's an issue I should know about? Bank details for reference: Account name: [Your business] BSB: [BSB] Account: [Number] Reference: INV-0042 Appreciate your reply by Friday. Thanks, [Your name]
The deadline at the end (“Appreciate your reply by Friday”) gives the client a concrete next step and gives you a clean reason to escalate if they ignore it.
Stage 3: Formal notice (Day 14–21 overdue)
Two to three weeks late. This message changes register. It’s polite but signals consequences. Keep a copy for your records — if the matter escalates, this is the paper trail.
Subject: FORMAL NOTICE — Invoice #[0042] now [14] days overdue
Hi [Client name],
This is a formal notice that invoice #0042 for $[amount],
issued on [date] and due on [due date], remains unpaid
[14] days after its due date.
Please arrange payment by [date — give 7 calendar days].
If payment is not received by that date, I will:
- Pause any current work pending account resolution
- Refer the matter to [debt collection / small claims tribunal]
- Recover any reasonable collection costs in addition to the
original invoice amount
Bank details:
Account name: [Your business]
BSB: [BSB]
Account: [Number]
Reference: INV-0042
I'd much prefer to resolve this directly. Please call me
on [phone] if you'd like to discuss a payment arrangement.
Regards,
[Your name]Can you charge late fees in Australia?
Yes — if you stated the fee on the original invoice or in a written agreement. You cannot add a surprise late fee after the fact. The common pattern is to include a single line on every invoice:
Overdue accounts may incur a late fee of 1.5% per month on the outstanding balance.
That wording is legally enforceable and rarely contested. Many businesses set the fee but don’t actually charge it — the existence of the fee on the invoice is itself a payment incentive.
When to escalate
If you reach 60 days overdue with no payment plan in place, escalate. Your options:
- Small claims tribunal — the fastest, cheapest path for amounts under your state’s limit. Filing fees are $50–$200. NCAT (NSW), VCAT (VIC), QCAT (QLD), and equivalent tribunals in other states handle most small business disputes.
- Debt collection agency — typically takes 20–40% of the recovered amount. Useful for larger debts where you don’t want to manage the process yourself.
- AFCA — only applies if your client is a financial services provider. Not applicable to most B2B disputes.
- Solicitor letter — a single letter from a lawyer often unlocks payment instantly. Costs $200–$500 for a one-off letter.
In most Australian states, you have 6 years from the original due date to pursue a debt before it becomes statute-barred. Don’t let invoices sit untouched for years.
How Free Invoice App automates this
Free Invoice App can send the entire 3-stage sequence automatically. You set the cadence once (e.g. day 1, day 7, day 14) and the system emails the reminders on your behalf with your own wording — or use the built-in templates. You only get involved if the client replies.
This is a Pro feature (A$5/month). Get started free on Starter (7 sends/month) or see Pro for automatic reminders, scheduled sending, and recurring invoices.
Frequently asked questions
Can I charge interest on a late invoice in Australia?
Only if you stated the fee on the original invoice or in a prior agreement. You can’t add a surprise fee after the fact. Common wording is “Overdue accounts may incur a 1.5% monthly late fee” on every invoice.
How do I write a polite invoice reminder?
Keep it short. State the invoice number, amount, original due date, and bank details. Don’t apologise — chasing payment is a routine part of business. A professional tone with a clear next step gets the best response rate.
What is the statute of limitations on unpaid invoices?
Six years from the date payment was due in most Australian states. After that, the debt becomes statute-barred and is no longer enforceable through the courts.
When should I send the first follow-up?
Day 1 overdue, not before, not a week later. A one-day-late reminder signals you keep close track of your invoices, which itself encourages on-time payment in future.
When should I escalate?
After 60 days overdue and three follow-up attempts. Small claims tribunal is usually the cheapest path for amounts under your state’s limit. Debt collection agencies typically take 20–40% of the recovered amount.