What if a client refuses to pay?

Asked by: Dr. Grant Jones DDS  |  Last update: April 30, 2025
Score: 4.4/5 (17 votes)

Dealing with a non-paying client can be frustrating and ugly, and it can make you feel cheated. If regular reminders don't work, contact higher-ups in the client's company or issue a formal debt collection letter to escalate the situation. When all else fails, take legal action or hire a collection agency.

How to deal with a client who won't pay?

Involve a third party: If communication and negotiation with the client has not resolved the issue, you may consider involving a third party, such as a mediator or a collection agency. Take legal action: As a last resort, you may consider taking legal action if the client continues to refuse to pay.

What happens if a customer refuses to pay?

If working with collections did not work, and unpaid invoices are still lingering, it is time to seek legal action. You have the choice between small claims court or civil court. Small claims court is less time, money, and is quick to resolve your issue within the same day.

What if a client does not pay?

You may be able to take formal debt recovery action if a customer repeatedly fails to pay the money they owe you. Your first step should be to issue a final request for payment and give them 7 days to pay what they owe. If this is unsuccessful, you may need to consider issuing them with a Statutory Demand.

Can I sue a client for not paying?

The answer is yes. An attorney can sue a client for non-payment of fees in a breach of contract lawsuit.

How to Deal With a Client Who Refuses to Pay

25 related questions found

Is it worth suing someone with no money?

Essentially, you might think suing someone with no money is futile, but that's not the case. The law protects your rights and allows you to seek compensation if someone causes you harm or loss, regardless of their financial status.

How to collect money from someone who won't pay?

How to Collect Money from Late-Paying Clients
  1. Send Polite Email Reminders. So let's start by assuming the best. ...
  2. Make a Simple Phone Call. ...
  3. Contact the Billing Department Directly. ...
  4. Cut off Future Work. ...
  5. Send a Final Demand Letter. ...
  6. Hire a Collection Agency. ...
  7. Go To Arbitration or Take Legal Action.

What can a contractor do if a client doesn't pay?

What to do if a client refuses to pay you
  1. Communicate with the client. ...
  2. Try to find a reasonable solution. ...
  3. Sue the client in small claims court. ...
  4. Get everything in writing. ...
  5. Get a deposit. ...
  6. Choose your clients wisely.

How do you deal with not paying customers?

How to handle clients not paying invoices
  1. Options for business owners when a client refuses to pay.
  2. Send payment reminders.
  3. Send a Letter of Demand.
  4. Explore mediation.
  5. Hire a debt collection agency.
  6. File a complaint with an industry commission.
  7. Lodge a claim with the Small Claims Tribunal.

How to write a letter chasing payment?

Writing a warning letter chasing late payment
  1. Your company name and address.
  2. Your customer's name and address.
  3. Invoice number.
  4. Total amount owed.
  5. Payment date and days overdue.
  6. Explain that payment terms have been breached.
  7. Payment details.
  8. Your contact information.

Can someone refuse to pay you?

When someone keeps "forgetting" to pay you or flat out refuses to pay up, the situation can quickly become frustrating. You can take the issue to small claims court and pursue legal action if it falls between the minimum and maximum money thresholds under court rules.

What to do when a customer walks out without paying?

Let the customer know that you mean business by setting a firm deadline for payment. Make it known that if the bill remains unpaid beyond this deadline, there will be consequences – such as suspending further services or taking legal action if necessary. Being firm doesn't mean being rude.

How to get a client to pay?

In this article, we'll cover:
  1. Include Payment Terms.
  2. Make Your Invoice Easy to Pay.
  3. Invoice the Right Person.
  4. Cultivate Strong Client Relationships.
  5. Send Friendly Reminders.
  6. Offer Simple Payment Methods.
  7. Offer Incentives to Pay Early.
  8. Request Payment in Advance.

What would you do if a customer refused to pay?

How to get customers to pay past due invoices
  1. Send a gentle reminder. ...
  2. Send an updated invoice. ...
  3. Ask why the client isn't paying. ...
  4. Demand payment more firmly. ...
  5. Escalate the situation. ...
  6. Hire a factoring service. ...
  7. Hire a debt collection service.

How do you force a company to pay your invoice?

How to get a client to pay an invoice: 4 tips to try
  1. Write a very clear email and reattach your contract. Send a friendly email reminder to a customer for payment. ...
  2. Work with a lawyer to send a payment demand letter. ...
  3. Take legal action. ...
  4. Hire a debt collector.

How to deal with non-payments?

Here's an overview of the key steps in collecting debt.
  1. Late payment demand or letter before action. The first step is to send the customer a late payment demand or letter before action. ...
  2. Court proceedings. If the customer doesn't pay up, the next step is to start court proceedings against them. ...
  3. Court hearing. ...
  4. Mediation.

What happens if a client refuses to pay?

When all else fails, a collection agency can collect your debt for you. Hiring a collection agency is often the last stop before litigation for businesses that need to settle an unpaid invoice. These agencies specialize in collecting payments over 90 days past due.

Can you refuse to work if you haven't been paid?

Legally, you may have the right to refuse work if your employer hasn't paid you, but this can vary by state. Always seek legal advice before taking such actions.

How to sue a client for non-payment?

The simplest and fastest form of legal action you can take is to file a claim in small claims court. Your case should be straightforward: You'll claim that the other side breached your written agreement by not paying you, and you want the judge to award judgment to you for the entire amount owed.

Can you sue a contractor for not paying?

If a subcontractor feels that the refusal to pay is unjustified, they can seek legal action to resolve the dispute. This could involve filing a breach of contract claim, where the court will decide whether the subcontractor is entitled to payment.

Is it worth suing a contractor?

Another factor to consider when determining if the quality of a contractor's work justifies a lawsuit is assessing financial losses. If the poor workmanship has resulted in significant monetary damages, such as repair costs or loss of property value, it may be appropriate to seek legal recourse.

Can you fire a contractor and not pay them?

No matter the reason that led to the termination of the contract, you must compensate an independent contractor for their work. Providing timely payment not only demonstrates professionalism but also keeps the door open for potential future collaborations.

Can I make a police report if someone owes me money?

It is not a crime per se, it is a civil tort issue. You have to sue the person to retrieve your money, the police can't help.. I sincerely hope that you have some sort of written agreement.

How do I get money back from someone who refuses to pay?

You can:
  1. File a civil case to get your money or property back. The court that hears the case will depend on the amount involved. ...
  2. File a civil case in rent court. ...
  3. File criminal charges. ...
  4. Once a court rules in your favor, you will have a judgment stating that the other person owes you money.

How to collect money from a customer who won't pay?

How to collect money from clients who won't pay
  1. #1: Send a reminder email right away. ...
  2. #2: Follow up with a phone call. ...
  3. #3: Contact the billing department directly. ...
  4. #4: Pause or cancel future work. ...
  5. #5: Offer a payment plan. ...
  6. #6: Offer an incentive for payment. ...
  7. #7: Send a formal demand letter.