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Automated Payment Reminders: How to Set Them Up in the UK

Business owner configuring an invoice reminder

Automated payment reminders are emails sent on a schedule about invoices that are due or overdue, so you stop chasing by memory. The best setup for a small UK business tracks every invoice without retyping, drafts each chaser for you and still lets you approve it before it goes. That is how Execore works: you Bcc a unique address on your invoices, and we draft the chase emails, including statutory late-payment interest and compensation, for you to review.

This guide covers how automated reminders work, a timing schedule you can copy, what a good reminder says, what to keep manual and what UK law says you can add to a late invoice.

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TL;DR

  • Automated reminders send or draft a message at fixed points: before the due date, on it, and at intervals after it.
  • Automate the tracking, the timing and the first draft. Keep approval, disputes and final demands in your hands.
  • Reminders about payment are generally treated as service messages under UK direct marketing rules, as long as they contain no promotion.
  • For business-to-business debts you can claim statutory interest and fixed compensation of £40, £70 or £100 depending on the invoice size.
  • You do not need new invoicing software: Execore captures invoices by Bcc and keeps a review queue, so nothing is sent until you approve it.

Table of Contents

What automated payment reminders are and how they work

An automated reminder is a rule: “when an invoice is X days past its due date and still unpaid, send this message.” Something has to know the invoice exists, its amount, its due date and whether it has been paid. Then something has to produce the message at the right moment.

Most tools split into three parts:

  1. Capture. The tool learns about the invoice. This is either by connecting to your accounting software or invoicing app, or by reading a copy of the invoice sent by email.
  2. Schedule. The tool checks each open invoice against your rules every day.
  3. Message. It sends a pre-written email, or drafts one for you to approve.

The weak point is almost always capture. If you have to re-enter every invoice into a second system, the reminders stop the first busy week you forget. That is why the capture method matters more than the reminder wording.

Many accounting packages include built-in reminders, but they often cap how many they will send. If you hit that wall, our guides on the limits of built-in invoice reminders and sending more than three reminders show how to carry on chasing past it.

A reminder schedule you can copy

There is no legal schedule. What works is a predictable rhythm that gets firmer without becoming hostile. A sensible default for a 30-day invoice:

When Purpose Tone
3 to 7 days before due Confirm the invoice arrived and the due date Friendly, helpful
Due date Short nudge with payment details Neutral
7 days overdue First chaser, ask for a payment date Polite, direct
14 days overdue Second chaser, restate the amount and terms Firm
21 to 30 days overdue Formal chaser adding statutory interest and compensation Formal
After that Personal contact and a decision on next steps Manual

Adjust it to your customers. A large company with a payment run every month needs the pre-due message more than a sole trader who pays on receipt. Whatever you choose, apply it to every customer. Consistency is what stops chasing from feeling personal, for you and for them.

If you want a wider list of ways to speed up payment beyond reminders, see 12 practical ways to get paid faster.

What an automated reminder should say

A reminder that gets paid is short, specific and easy to act on. Include:

  • The invoice number, date, amount and due date. The customer’s accounts team should find it in seconds.
  • The plain fact: “This invoice is now 14 days overdue.”
  • What you want: payment by a named date, or a reply with the date they will pay.
  • How to pay: bank details or payment link, written out, not “as per invoice”.
  • A copy of the invoice attached or clearly referenced.
  • Your name and a direct reply address. A reminder from a no-reply address invites silence.

Personalise with the customer’s name, the job or project and the invoice reference. Do not add a promotion for your other services. That is not just poor manners: the Information Commissioner’s Office (ICO) explains that messages chasing debts count as service messages rather than direct marketing, but its guidance to Parliament states that if a service message contains elements of direct marketing, the whole message counts as direct marketing and falls under the consent rules. Keep reminders purely about the money owed.

Escalating wording

The first reminder can assume an oversight: “Just checking this has reached your accounts team.” The second states the overdue period. The third should say what happens next, for example that you will be adding the interest and compensation the law allows. Do not threaten anything you are not prepared to do.

What to automate and what to keep manual

The sensible division is to automate everything repetitive and keep everything that needs judgement.

Automate:

  • Logging each invoice as soon as it is sent.
  • Watching due dates and flagging what is overdue.
  • Producing the first draft of each chaser with the right figures.
  • Calculating statutory interest and compensation, which is fiddly by hand.
  • Showing a running total of what is owed to you and what you owe.

Keep manual:

  • Approval of anything sent to a customer. A reminder sent to someone who paid yesterday, or who has a dispute running, damages the relationship you wanted to protect.
  • Disputes. If a customer says the work was wrong or the invoice is incorrect, a scheduled reminder makes things worse. Pause the chasing and resolve the issue first.
  • Key accounts. For a customer who gives you half your income, a phone call beats any email.
  • Final demands and legal action. These are decisions, not routines. Our step-by-step guide to recovering unpaid invoices covers what comes after reminders.
  • Payment. Moving money out of your account should always be your click.

This is the reason Execore keeps a review queue. We draft, you approve, and nothing is ever sent or paid until you do. You get the time saving of automation without the risk of a rogue email.

If your customer is another business, the Late Payment of Commercial Debts (Interest) Act 1998 gives you rights that most reminders never mention. Using them is often what moves an invoice to the top of a payment pile.

Fixed compensation

Under section 5A of the Act, you can claim fixed compensation for each late invoice: £40 for debts under £1,000, £70 for debts from £1,000 up to £10,000, and £100 for debts of £10,000 or more. Reasonable extra recovery costs can be added in some cases.

Statutory compensation tiers for late invoices

Statutory interest

Interest normally starts the day after the payment date. Where no date was agreed, section 4 of the Act provides a 30-day rule running from performance or notice of the debt, whichever is later. Contract terms can only replace statutory interest where the agreed remedy is substantial, as section 8 explains, so a token clause does not automatically override your rights.

For a worked explanation with examples, read our guides on statutory interest on invoices and how to charge interest on a late invoice.

A worked example: you invoice a business £2,400 and it is 30 days late. The fixed compensation is £70, and interest is added on top at the statutory rate for the days overdue. Our drafts calculate both and put them in the chase email, so the figures are right before you approve.

Reforms on the way

The government has announced changes. In March 2026 it said it will introduce mandatory interest of 8% above the Bank of England base rate and a 60-day cap on payment terms for large firms paying smaller suppliers. In May 2026 the Small Business Protections Bill entered Parliament, including powers for the Small Business Commissioner to fine persistent late payers. These are proposals until the law is passed, so check the GOV.UK pages for what is in force when you send your reminder.

Why timing matters for your cash and your tax

The government’s own figures show how much is at stake: in December 2024 it reported that small and medium-sized firms were owed an average of £22,000 a year in late payments. For a business with no cash cushion, one unpaid invoice can mean delaying your own bills.

Tax makes it sharper. If you are VAT-registered on standard accounting, you normally owe VAT when you issue the invoice, not when you are paid. Under the Cash Accounting Scheme, output VAT is accounted for when the customer pays instead, though only if expected taxable supplies are £1.35 million or less in the next year and other conditions are met. Either way, an overdue invoice can leave you funding a tax bill from your own pocket, which is why chasing before a tax deadline pays.

Why timing matters for your cash and your tax

If late payment has already pushed your own finances into trouble, debt help for self-employed people sets out the options available in the UK.

How to set up automated reminders step by step

  1. Decide your payment terms. State them on every invoice: due date, bank details and a line saying you charge statutory interest and compensation on late payment. Reminders are far easier when the terms were clear from the start.
  2. Choose how invoices get captured. Connecting to accounting software works if you already use it. If you would rather not change how you invoice, a Bcc-based tool avoids connections altogether. With Execore, you Bcc your unique address on outgoing invoices and forward bills you receive, and your invoicing workflow stays exactly as it is.
  3. Write your three templates: a friendly pre-due note, a first overdue chaser and a formal one with interest and compensation.
  4. Set the schedule using the table above.
  5. Put a human approval step on anything customer-facing. Execore’s review queue does this: drafts wait for you.
  6. Make exceptions easy. Know how to pause chasing for a disputed invoice or a customer you have spoken to.
  7. Review weekly. Ten minutes on the overdue list beats a month-end scramble. Execore shows overdue debts highlighted alongside a net cash position for the next 30 days.

Common mistakes

  • Sending reminders to customers who have already paid, because payments were not recorded.
  • Using a tone so soft it is ignored, or so harsh it ends the relationship.
  • Mixing marketing into a reminder.
  • Chasing a disputed invoice on autopilot.
  • Stopping at a fixed number of reminders because the software does.

Perspective

Most small businesses do not have a chasing problem, they have a visibility problem. The invoice went out in the first week of the month, nobody wrote down when it was due, and by the time it matters it is six weeks old and awkward to raise.

We built Execore around the idea that you should not have to change how you work to fix that. You keep your invoicing as it is, you Bcc one address, and the invoice is captured. There is no new system to learn and no bank connection to set up. The drafts, including the statutory interest and compensation figures, are written for you, and nothing leaves your account until you approve it.

That approval step is deliberate. Automation should take the repetitive work off your plate, not take control away from you. You stay in charge of the relationship, and we remove the hours spent working out who owes what and what to say.

the author

Try it on your own invoices

If you invoice from email, a spreadsheet or any other tool, Execore can sit alongside it. You Bcc your unique address on invoices, forward the bills you receive, and get drafted chasers for overdue invoices in a review queue, plus a net cash position for the next 30 days. There is a Free plan, and the Business plan is £29 per month, both on the pricing page. You can also see how it works on the Execore home page.

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For a wider look at what to automate in your invoicing, our practical guide to invoice automation and our piece on invoice admin for small businesses go further.

FAQ

Yes. Messages chasing a debt are service messages in the ICO’s guidance, not direct marketing, provided they are purely about the payment. If you add promotional content, the whole message can fall under the electronic marketing consent rules, so keep them focused on the invoice.

When should the first reminder go out?

A short note a few days before the due date confirms the invoice arrived and prevents most accidental delays. The first chaser proper usually follows about a week after the due date. What matters is that you use the same rhythm for every customer.

Can I add interest and compensation to a reminder?

For business-to-business invoices, yes. The 1998 Act allows fixed compensation of £40, £70 or £100 depending on the debt, plus statutory interest. Mention it in your later reminders, ideally after your payment terms have said you will charge it.

Should every reminder be sent automatically?

We recommend automating the tracking, timing and drafting, and approving each message yourself. That avoids chasing customers who have just paid or who have a dispute open, and it keeps the tone yours.

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