Unpaid Invoice Over 90 Days NSW: Your Legal Options

# Unpaid Invoice Over 90 Days: What Are Your Legal Options in NSW?

You sent the invoice. You sent a reminder. You called. You emailed. It’s been over 90 days, and you still haven’t been paid. If you’re a NSW small business owner, contractor, or freelancer, you have clear legal options to recover what you’re owed.

This guide explains the debt recovery pathway when an invoice has been unpaid for 90 days or more in New South Wales, from demand letters to NCAT tribunal claims.

Why 90 Days Matters

There’s no magic threshold at 90 days, but it’s a practical marker. Most payment terms are 7, 14, or 30 days. By 90 days overdue, you’ve likely sent reminders, made calls, and exhausted goodwill.

This timeline gives you evidence of:

• Reasonable opportunity to pay
• Pattern of avoidance
• Serious intent to recover

This strengthens your position if you need to apply to NCAT or defend against a counterclaim.

Step 1: Send a Letter of Demand

A letter of demand is the formal first step in debt recovery. It’s a written notice that states the amount owed, refers to the invoice and any contract, and gives a deadline (typically 7-14 days) before you commence tribunal proceedings.

In NSW, a properly drafted letter of demand often results in payment without further action. It signals you’re serious and creates a paper trail if you proceed to NCAT.

What to include:

• Your ABN and business details
• Invoice number(s), date(s), and amount(s)
• Brief description of the goods or services supplied
• Payment terms from your contract or invoice
• Clear demand for payment within a specified time
• Statement that you will commence tribunal proceedings if unpaid

A letter of demand does not need to be sent by a lawyer. It needs to be clear, factual, and cite the correct legal basis for the debt.

Step 2: Understand Your Legal Basis

Before you escalate, confirm the legal foundation of your claim. In NSW, unpaid invoices are typically recovered under:

Contract law — if you had a written or verbal agreement for goods or services, and the other party breached by not paying.

Australian Consumer Law — if you supplied goods or services to a consumer or small business, and they were accepted without payment.

Quantum meruit — if there was no formal contract, but you provided work at the other party’s request, you can claim a reasonable price.

Your letter of demand should reference the relevant law. For example:

• “Payment is due under the Service Agreement dated 12 March 2024.”
• “The debt arises from goods supplied and accepted under Australian Consumer Law.”
• “You requested the work and accepted the benefit, creating an obligation to pay a reasonable sum.”

Step 3: NCAT Small Claims Division

If the letter of demand is ignored, your next step is the NSW Civil and Administrative Tribunal (NCAT). For debts under $30,000, you apply to the Consumer and Commercial Division — Small Claims.

NCAT advantages:

• No lawyers required (parties usually represent themselves)
• Filing fee from $38 to $184 depending on claim value
• Hearings are informal and conducted by a tribunal member
• Decisions are binding and enforceable
• Usually resolved within 3-6 months

What you need to file:

• Completed NCAT application form (available online)
• Copy of the invoice(s)
• Copy of any contract or agreement
• Copy of your letter of demand
• Evidence of delivery (email receipts, registered post tracking)
• Any correspondence showing the debt is disputed or acknowledged

NCAT does not require a lawyer, but your case must be clear and supported by evidence. The tribunal member will ask both parties to explain their position, review the documents, and make a decision.

Step 4: What Happens at NCAT

NCAT small claims hearings are designed to be accessible. Here’s the typical process:

1. Application filed — you submit your claim online or by post, pay the filing fee, and NCAT serves the respondent (the debtor).

2. Respondent has 28 days to reply — they can admit the debt, dispute it, or file a counterclaim.

3. Conciliation or hearing — NCAT may schedule a conciliation conference (informal settlement discussion) or proceed directly to a hearing.

4. Hearing — both parties present their case. You show your invoice, contract, and evidence of non-payment. The respondent explains why they haven’t paid (or disputes the debt).

5. Decision — the tribunal member makes a binding order, usually on the day or within a few weeks.

Common outcomes:

• Order for payment in full plus interest and filing fee
• Payment plan if the debtor can prove financial hardship
• Claim dismissed if the debt is genuinely disputed or evidence is insufficient

If you win, the tribunal issues a formal order. If the debtor still doesn’t pay, you can enforce the order through a garnishee (wage or bank account seizure) or instruct a sheriff to seize assets.

When to Skip NCAT and Go to Court

NCAT is the right forum for most unpaid invoices under $30,000. However, you may need to file in the Local Court or District Court if:

• The debt exceeds $30,000
• The debtor is disputing liability on complex legal grounds
• You need urgent freezing orders or injunctions
• The debtor is a company and you’re considering a statutory demand

For debts over $30,000 but under $100,000, the Local Court may be more appropriate than NCAT — but you’ll likely need a lawyer for that pathway.

Interest and Costs

In NSW, you can typically claim interest on unpaid invoices from the date the debt was due. The rate depends on whether your contract specifies interest terms, or whether you’re relying on statutory provisions.

You can also claim:

• NCAT filing fee (if you win)
• Service costs (if you paid for registered post or process serving)
• Reasonable debt recovery costs (if your contract allows it)

NCAT does not usually award legal costs in small claims, but it will order the losing party to reimburse your filing fee.

What If the Debtor Disputes the Invoice?

If the debtor genuinely disputes the debt — for example, they claim the work was defective, incomplete, or not authorised — NCAT will hear both sides.

Your evidence matters:

• Signed contract or quote
• Email or text confirming the work was requested
• Proof of delivery or completion (photos, delivery dockets, signed acceptance)
• Correspondence showing the debtor accepted the work without complaint

If the dispute is about quality, NCAT may reduce the amount owed or dismiss the claim entirely. This is why documentation is critical.

If the dispute is spurious — for example, the debtor suddenly claims defects only after you demanded payment — NCAT will typically see through it, especially if you have evidence they accepted the work without complaint for weeks or months.

Debt Recovery for Companies: The Statutory Demand Option

If the debtor is a registered company (Pty Ltd or Ltd) and owes $4,000 or more, you can issue a statutory demand under the Corporations Act.

A statutory demand gives the company 21 days to pay or face wind-up proceedings. It’s the most powerful debt recovery tool against a company, but it must be used correctly:

• Debt must be liquidated (a specific, ascertained amount)
• Debt must not be genuinely disputed
• The correct form must be completed and served personally or by registered post
• Supporting affidavit must be sworn before a JP or solicitor

If the company fails to pay or apply to set aside the demand within 21 days, you can file to wind up the company. Most companies pay rather than risk insolvency.

How ClaimDone Helps NSW Small Businesses Recover Unpaid Invoices

ClaimDone’s Proprietary AI Engine reads your invoice, contract, and correspondence, then drafts a legally precise letter of demand citing NSW and Commonwealth law. The letter is automatically sent to the debtor by email and registered post, creating a formal record.

What you get:

• Professionally formatted letter of demand
• Correct legal citations (contract law, ACL, quantum meruit)
• Automatic delivery by email and tracked post
• Evidence pack if you proceed to NCAT
• $79 flat fee, no subscription, done in 60 minutes

If the debtor doesn’t pay after the demand letter, you can use the letter and delivery records as evidence in your NCAT application. ClaimDone also prepares NCAT tribunal applications for $97, including all required forms and a step-by-step filing guide.

For company debtors owing $4,000+, ClaimDone prepares statutory demands for $197.

Practical Tips for NSW Debt Recovery

1. Keep records — save every email, text, invoice, quote, and delivery receipt. NCAT decisions are based on evidence, not stories.

2. Act quickly — the longer you wait, the harder it is to recover. Debtors move, close businesses, or spend the money.

3. Be clear and factual — emotional or aggressive language weakens your position. Stick to facts, dates, and amounts.

4. Use the right tool — demand letter first, NCAT if ignored, statutory demand if it’s a company debt over $4,000.

5. Don’t give up — many small businesses write off debts because they think recovery is too hard or expensive. NCAT is designed for self-represented parties, and the filing fee is recoverable if you win.

Enforce the Order

If you win at NCAT and the debtor still doesn’t pay, you can enforce the order through:

Garnishee order — seize money from the debtor’s bank account or wages.

Writ for levy of property — instruct a sheriff to seize and sell the debtor’s assets.

Examination notice — require the debtor to attend court and disclose their financial situation under oath.

Enforcement is a separate process with additional fees, but it’s straightforward if the debtor has assets or income.

When to Get a Lawyer

You don’t need a lawyer for most unpaid invoice claims under $30,000 in NSW. NCAT is designed for self-represented parties, and ClaimDone provides the documents you need.

Consider a lawyer if:

• The debt exceeds $30,000
• The debtor has filed a complex counterclaim
• The dispute involves defamation, fraud, or criminal conduct
• You’re considering winding up a company
• The debtor is legally sophisticated and likely to challenge jurisdiction or procedure

For straightforward unpaid invoices, a demand letter and NCAT application are usually enough.

Get Your Demand Letter Sent Today

If you’re owed money on an invoice that’s been unpaid for 90 days or more, start with a letter of demand. It’s fast, affordable, and often results in payment without further action.

Get your demand letter drafted and sent automatically with ClaimDone in 60 minutes for $79. If the debtor doesn’t pay, prepare your NCAT application with ClaimDone for $97. For company debtors, issue a statutory demand against a company debtor for $197. No subscription, no hidden fees, no lawyer required.

Frequently Asked Questions

Can I charge interest on an invoice that's 90 days overdue in NSW?

Yes. In most cases, you can claim interest from the date payment was due. The rate depends on whether your invoice or contract specifies interest terms, or whether you’re relying on statutory provisions. Your demand letter should state the interest claimed and the basis for it.

How much does it cost to file an unpaid invoice claim at NCAT?

NCAT filing fees range from $38 (claims up to $10,000) to $184 (claims $20,001-$30,000). If you win, the tribunal will usually order the debtor to reimburse your filing fee. NCAT does not award legal costs in small claims, but you can represent yourself without a lawyer.

What if the debtor claims the work was defective after I send a demand letter?

NCAT will hear both sides. If you have evidence the debtor accepted the work without complaint for weeks or months, and only raised defects after you demanded payment, the tribunal will likely see the dispute as spurious. Documentation is critical — keep emails, texts, photos, and delivery records.

Can I use a statutory demand for an unpaid invoice in NSW?

Yes, but only if the debtor is a registered company (Pty Ltd or Ltd) and the debt is $4,000 or more. A statutory demand under the Corporations Act gives the company 21 days to pay or face wind-up proceedings. It’s the most powerful tool against a company debtor, but must be used correctly.

How long does NCAT take to resolve an unpaid invoice claim?

Most NCAT small claims are resolved within 3-6 months from filing to decision. Simple cases with clear evidence may be decided at the first hearing. If the debtor disputes the claim, NCAT may schedule a conciliation conference before proceeding to a full hearing.