Most UK freelancers are working with contracts that do not protect them.
Not because they are lazy. Because nobody tells you what actually matters until you have already lost money.
Here is the clause that changed things for me.
The Late Payment Act — your silent weapon
The Late Payment of Commercial Debts (Interest) Act 1998 gives you, automatically, the legal right to:
- Charge 8% + Bank of England base rate interest on overdue B2B invoices
- Add £40-£100 fixed compensation per late invoice
- Recover reasonable debt recovery costs
You do not need to put this in your contract. It applies by law.
But putting it in your contract means your client knows you know. That changes behaviour.
The exact clause
Add this to your standard contract:
Payment is due within [14/30] days of invoice date. Late payments will incur statutory interest under the Late Payment of Commercial Debts (Interest) Act 1998 at 8% above the Bank of England base rate, plus fixed compensation of £40-£100 per invoice depending on the debt amount.
That is it. 47 words.
In four years of freelancing, I have only had to invoke it once. But having it there meant clients paid on time, because they knew I would.
Three other clauses worth adding
1. Ownership retention clause
Copyright and ownership of all deliverables remain with [Your Name] until full payment is received.
This means if they do not pay, they cannot legally use what you made.
2. Late fee trigger
A late payment fee of [2-5%] will be automatically applied to invoices unpaid after [14] days.
Some clients respond better to a concrete percentage than statutory rates.
3. Kill fee
If the project is cancelled by the client after [milestone], a kill fee of [25-50%] of remaining fees is due within 14 days.
This protects you from the client who disappears mid-project after you have turned down other work.
The conversation you are avoiding
Most freelancers avoid putting strong payment terms in contracts because they worry it signals distrust.
Flipped: a client who objects to standard UK legal protections is telling you something important about how they plan to behave.
The conversation you are dreading is far cheaper than the £4,800 lesson.
What to do this week
- Pull out your current contract
- Check: does it mention the Late Payment Act? (It almost certainly does not)
- Add the clause above
- Send your next invoice referencing your updated payment terms
If you want the full contract template with all these clauses pre-written, plus the 4-touch email sequence for chasing payment, it is all in the Contract Template Pack at Landolio — £9, instant download.
Or use the free Late Payment Interest Calculator to see what you are legally owed on an overdue invoice right now.
Either way — go update your contract tonight.
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