01142747576 bestadvice@knowleswarwick.com

New prompt payment rules take effect

6th September 2019

Large companies that pay late will now be excluded from winning Government contracts, following new prompt payment rules that came into force on 1 September 2019.

The policy, which was first announced in November 2018, applies to contracts worth more than £5 million a year.

To be considered for these contracts, companies must show they pay at least 95% of their invoices within 60 days.

Simon Hart, Minister for Implementation, said:

"Developing a prompt payment culture is critical for all companies helping to deliver vital public services.

"And it's particularly important for small businesses who may not have the reserves of larger organisations.

"That's why we're making it clear to big businesses that they must get their payment records in order or face the very real risk of missing out on large government contracts in the future."

Mike Cherry, chairman of the Federation of Small Businesses, added:

"We welcome the new administration taking ownership of the late payment crisis with this crucial step, sending a message that late payments will not be tolerated within Government contracts."

Talk to us about your business.

Happiness is a Positive Cash Flow

Click here for the Quickbooks website Xero Gold Partner Accountants Sage accountants, experts in cloud accounting, Sheffield, South Yorkshire 

ICAEW Chartered Accountants Click here for the ACCA website Connect Yorkshire  Sheffield Chamber of Commerce Click here for the Caunce O'Hara website 

Knowles Warwick Financial Services Limited is authorised and regulated by the Financial Conduct Authority (in respect of regulated investment, insurance and mortgage business). For regulated financial services, the Financial Ombudsman Service is the alternative dispute resolution provider.