Debtor FAQs

Debtor FAQs: Your Questions Answered

If you’ve received correspondence from DCS, this page answers the most common questions we receive. Can’t find what you’re looking for? Contact us and we’ll be happy to help.

Q: Why have you requested information about my business ownership?

A: We may write to request ownership details when it’s unclear who operates the business. This typically applies to:

Sole traders
Unincorporated partnerships
Companies trading under a different name than their registered company name

Our correspondence explains exactly what information is required and the legal basis for requiring an immediate written response. Learn more about business information requests.

Q: I’m disputing the invoice due to poor quality work or goods. What should I do?

A: If you have a genuine dispute regarding the quality of work done or goods supplied:
1. Contact DCS with detailed information about your dispute
2. Pay the undisputed portion of the debt immediately
3. Allow us to mediate – DCS will liaise with both parties to resolve the dispute promptly

Disputing an invoice doesn’t eliminate your obligation to pay the undisputed amount. Contact us to discuss your dispute.

Q: What happens if I pay the invoice but not the interest and late payment fees?

A: Interest charges continue to accrue daily until the debt is paid in full. This includes:

The original invoice amount
All applicable interest charges
Late payment fees or compensation entitlement

Partial payments will reduce the outstanding balance, but interest continues to be added to the debt until the debt is paid in full.

Q: I’ve received a letter from DCS. Who should I contact about the debt?

A: Contact DCS directly. Once we’ve been instructed by the creditor, there’s no need to contact the company you owe money to. You need to contact DCS. Once DCS has been instructed there is no need for you to contact the organisation that you owe money to.

All queries should be directed to DCS:
– Phone: 0117 370 4236
– Email: office@debtcollectionservice.uk
– Address: DCS, Easton Business Centre, Felix Road, Bristol BS5 0HE

Q: Where do I send our cheque?

A: We prefer payment by bank transfer direct to our client (our correspondence will include the bank details for your payment).

If you need to make payment by cheque, you should post your cheque to: Debt Collection Service, Easton Business Centre, Felix Road, Bristol BS5 0HE. (It is helpful if you email us to advise that a cheque has been sent.)

Make your cheque payable to the original creditor (the company you owe), NOT to Debt Collection Service. Always quote your case number on the payment.

Q: Can I pay via bank transfer, BACS, CHAPS etc?

A: Yes, this is our preferred payment method. The correspondence from DCS includes the bank account information for our client, along with the reference we would like you to quote when the payment is made. If you don’t have the bank details to hand, then please contact us and we will email you the bank account information, and the reference that you will need to quote. (We do not give bank account details by phone.)

Q: How are interest charges calculated on my debt??

A: For business to business debts, interest charges are calculated in accordance with UK legislation:
– Late Payment of Commercial Debts (Interest) Act 1998
– The Late Payment of Commercial Debts (Rate of Interest) (No 3) Order 2002

Interest accrues from the date the invoice became overdue until it’s paid in full.

Further information on statutory interest charges is available here.

After a County Court Judgment (CCJ) has been granted, interest may be calculated at 8% per annum as specified by the County Court Act 1984, s69.

Q: We never agreed to pay interest on late payments. How can you charge this?

A: For business-to-business (B2B) debts, interest charges are statutory – meaning they’re established by Acts of Parliament:
– Late Payment of Commercial Debts (Interest) Act 1998
– The Late Payment of Commercial Debts (Rate of Interest) (No 3) Order 2002

No prior agreement or notification is required. These charges can be applied under UK law to protect businesses from late payment. Our ‘legislation’ webpage provides additional information. The “Statement of Debt” sent to the debtor provides information on the legislation, as well as the relevant interest rate and the number of days for which interest has been charged.

Q: What is the “Late Payment Fee” or “Compensation Entitlement” charge?

A: The Late Payment Fee (also called Compensation Entitlement) is a statutory charge that applies to each overdue invoice based on its value:

Value of each unpaid invoice:
           Up to £999.99 = £40.00
           £1,000 to £9,999.99 = £70.00
           £10,000 or more = £100.00

This fee compensates the creditor for the administrative costs of chasing late payment. More information on compensation entitlement.

Q: We never agreed to a Late Payment Fee. What gives you the authority to charge this?

A: Late Payment Fees are mandated by law, not by agreement. They’re established under:
– The Late Payment of Commercial Debts Regulations 2002 (SI2002/1675)
– Late Payment of Commercial Debts (Interest) Act 1998

No prior consent or notification is required because these charges are statutory – they’re written into UK law to protect businesses from the costs of pursuing late payments.

Q: My solicitor/adviser says charges can only be added by a Court. Is that true?

A: No, that’s incorrect.

Interest charges and late payment fees are statutory charges under UK law and apply automatically to business-to-business debts without court involvement. The legislation cited above gives creditors the legal right to add these charges from the date an invoice becomes overdue.

If you’ve received conflicting advice, we recommend your legal adviser reviews:
– Late Payment of Commercial Debts (Interest) Act 1998
– The Late Payment of Commercial Debts Regulations 2002

These Acts of Parliament clearly establish the creditor’s right to add interest and compensation charges without court action.

Need More Help?

If your question isn’t answered here, please don’t hesitate to contact us:

Debt Collection Service
0117 370 4236
office@debtcollectionservice.uk

Easton Business Centre, Felix Road, Bristol BS5 0HE

Visitors are seen by appointment only

Questions frequently asked by debtors