Client Won’t Pay Your Invoice? 5-Step Recovery Process for Australian Businesses

You delivered the work. You sent the invoice. Thirty days passed, then sixty. The client is not paying. Maybe they are ignoring your emails. Maybe they are “reviewing” the invoice indefinitely. Maybe they disappeared entirely.

This is the reality for thousands of Australian small businesses, freelancers, and contractors every month. Here is the proven process to get paid.

Step 1: Send a payment reminder (Day 31)

Give the benefit of the doubt once. Send a polite email reminding them the invoice is overdue. Attach the original invoice. Ask for payment within 7 days.

Keep it professional. Many late payments are genuine oversights, especially with larger companies where accounts payable is a separate department.

Step 2: Make a phone call (Day 38)

If the email gets no response, call them. Ask to speak to the person who authorised the work. Document the call — date, time, who you spoke to, what was said.

If they give you a new payment date, confirm it in writing by email: “As discussed on the phone today, you confirmed payment of $X by [date].”

Step 3: Send a Letter of Demand (Day 45)

This is where it gets formal. A Letter of Demand is a legal document that:

• States the exact amount owed with invoice references
• Cites your legal right to payment under Australian contract law
• Sets a final deadline (14 days)
• States the consequences of non-payment — tribunal application, debt recovery, credit reporting, and (for companies owing $4,000+) a statutory demand under the Corporations Act

A formal Letter of Demand converts a “maybe they forgot” situation into “this person is serious and will take legal action.”

Step 4: File a claim (Day 60)

If the Letter of Demand is ignored, file a claim. In New South Wales a business debt goes to the Local Court (Small Claims Division up to $20,000, General Division over $20,000 up to $100,000), not NCAT; in other states, check which tribunal or court hears debt claims. You do not need a lawyer. Bring:

• The contract or agreement (even a text message confirming the job counts)
• All invoices
• Proof of delivery / completion
• Your Letter of Demand and proof it was sent
• Any communication showing they acknowledged the debt

Step 5: Enforce the order

If you get an order and they still do not pay, you can enforce it through the Local Court (New South Wales) or the Magistrates Court. Options include:

• Garnishee order (takes money directly from their bank account)
• Enforcement warrant (sheriff seizes assets)
• Examination summons (they must disclose their finances under oath)

Start the process now

The longer you wait, the less likely you are to recover the debt. Companies can be wound up, individuals can move interstate, and the limitation period is 6 years from when the debt became due.

Claim Done drafts your Letter of Demand for $49. Tell us who owes you, how much, and what happened — we draft the letter citing Australian law and send it to the debtor. Done in about 5 minutes.

If they do not pay after the letter, we prepare your Tribunal Application ($97), which includes a witness statement. You attach your own evidence and lodge it yourself.