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Due to a small change in regulations, the debtor is now liable to pay all costs of default proceedings. What this means for you is 100% free debt collection on successful recovery with Thomas Higgins.

Under the Late Payment of Commercial Debts (Interest) Act 1998, you are entitled to claim back the costs involved with recovering your debts. Our Late Payment Demand letter not only instructs the debtor to pay the debt owed within seven days but enables you to recover the costs of using our services at various stages of the collection process.

Therefore, by choosing Thomas Higgins for your debt recovery, there is no need for you to be out of pocket for chasing money that is rightfully yours. With a successful claim, not only are our costs covered but as we don't charge commission or a percentage, you will receive all of what is retrieved from the debtor and at no extra cost.

But that’s not all.

By sending one of our Late Payment Demands to your debtor you are also able to claim compensation and additional interest on each of your outstanding invoices. You are entitled to claim between £40 to £100 in compensation per invoice and interest at 8% above the Bank of England's base rate. This is all in addition to the original debt amount and legal costs.

What is debt collection or recovery?

Debt collection is the process of pursuing payments of debts owed by individuals or businesses. Thomas Higgins specialises in legal debts owed by businesses to other businesses.

An organisation that specializes in debt collection is known as a collection agency. Most collection agencies operate as agents of creditors and collect debts for a fee or percentage of the total amount owed.

Thomas Higgins is a specialist debt recovery law firm. We advise you, as credit managers, on the best strategy for their cases and ensure that costs are kept to a minimum.

Learn more about debt collection actions in this video:

What is the process of legal debt collection?

The process of collecting legal debts is typically done in four stages: Letter Before Action, Legal Claim, County Court Judgment, and Enforcement.

  • Letters Before Action: Before issuing any legal proceedings, a letter before action should be sent to a debtor
  • Legal Claim: If you send a letter before action to your debtor but do not receive a satisfactory response then the next stage is to issue legal proceedings through the County Court. You will send the debtor a court form requiring them to pay the debt, plus interest and costs within 14 days.
  • County Court Judgment: This is a court order that confirms that the debtor has defaulted on their payment. A CCJ can be obtained immediately after the expiry date of the Claim. The CCJ is the final decision by the Court which gives you the power to take enforcement action to collect the debt.
  • Enforcement: Once a CCJ has been obtained, it is then possible to “enforce” that debt immediately. Total debts, including costs and interest amounting to £600 and under, are sent to the county court bailiff. Total debts of over £600 we will send to an enforcement officer. We find this is the most appropriate method of enforcement based on our 40 years of experience and expertise in similar cases.

What is the Late Payment of Commercial Debts (Interest) Act 1998?

The Late Payment of Commercial Debts (Interest) Act 1998 has two purposes for debt recovery.

First, the Act seeks to compensate creditors for the late payment of debts. Secondly, the Act is also used to deter late payment. The Act only applies to the commercial supply of goods and services where you don’t have any provision for interest in your terms of business. The Act extends to businesses and public sector organisations in England, Scotland and Northern Ireland.

In summary, for invoices that are not paid on time, the act enables you to claim interest, compensation and your reasonable costs of collecting the debt where these exceed the compensation. The reasonable costs of collecting debt only apply for orders placed after 16 March 2013.

Thomas Higgins Limited

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Lloyds Chambers
19-21 Seaview Road
CH45 4TH
0151 452 0452

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