Freelancers: How to get paid on time, every time |
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| Introduction |
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| Being a contractor has many advantages and one disadvantage – you are it! You have to do everything, including chasing payments owed to you by clients. If you have an ongoing relationship with a client who provides you with regular work, you probably don’t want to be discussing a project in the morning and overdue invoices in the afternoon. |
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| But do ensure you are paid on time. How? Read on... |
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| Set clear expectations from the start |
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| When you start a piece of work for a client, give them a written copy of your terms and conditions (downloadable from Net Lawman). If you are doing ongoing work, agree at what points you will be paid, and consider refusing to continue work on a project if a payment is late. Also tell your clients how you prefer to be paid; for example a bank account transfer means you will get your money more quickly. Also state how many days’ credit you will give them - 14, 28 or 30 days is normal. Be clear what will happen if they don’t pay on time. Legally you are entitled to charge interest on late payments. |
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| Make invoices easy to pay |
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| The easier it is for your client to pay an invoice, the faster you get paid. |
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- List exactly what the invoice is for and break down anything that could be unclear to a layman;
- Date the invoice and ensure you state the date it must be paid by;
- List your preferred payment method again, and don’t forget to give essential details such as account number and sort code for BACS payments, or the name the cheque should be made payable to;
- Consider printing and posting invoices as well as emailing them; it’s a good way of guaranteeing your invoice doesn’t get lost;
- Ensure all invoices include a reference number so that it is easy for both you and your client to refer to which invoice you mean when you have to tell them that payment is late.
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| Be brutal with credit control |
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| Most clients that pay late are forgetful or inefficient – few don’t ever intend to pay at all. You’ll soon discover your clients’ attitude towards money owed when you remind them. The ones that are genuinely horrified and pay straight away are the honest ones! Send reminder letters or emails stating the amount owed and how overdue it is. |
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| Letters can be a little more “anonymous” than phone calls chasing money, and in the eyes of your client can help to distance you the supplier, from you the debt collector. Phone calls of course, often get faster results. Our tip? Find out the name of the person who actually processes payments for your clients and deal only with them for money matters, rather your day-to-day contact. |
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| Be open about how important it is to be paid on time |
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| It is accepted that as a freelancer you are a one man band and need money in the bank to put food on the table. The appeal of freelancers to businesses is that they can work out cheaper or provide better value than companies. |
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| So it’s only fair to ask for prompt payment! Whatever you do, don’t fall in the trap of holding back from chasing money that’s rightfully yours. This is business not personal and you need to approach it that way. |
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| Click to buy services contract from here: Contract for service |
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