The UK government announced significant legislative reforms to tackle late payments to small and medium-sized businesses, marking the strongest regulations in the G7 in over 25 years. Currently, the Late Payment of Commercial Debts Act allows for charging interest on overdue payments, but enforcement is weak. New proposals include establishing a default payment term of 30 days, considering a maximum of 45 days, and granting stronger powers to the Small Business Commissioner to impose fines and conduct checks. These measures aim to alleviate the burden on SMEs suffering from late payments.
Too many hardworking people are being forced to spend precious hours chasing payments instead of... growing their businesses. Small firms go under each year because they aren't paid on time.
The UK government has announced plans to tackle late payments to small and medium sized businesses, introducing the toughest laws on late payment in the G7.
Stricter maximum payment terms will be established, with 30 days as the default, and a maximum of 45 days being considered.
The Small Business Commissioner will have stronger powers, potentially including the ability to levy significant fines against large firms for persistent late payments.
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