What is a letter before action?

A formal letter to a customer who owes you money, sent before you start court proceedings. The Practice Direction on Pre-Action Conduct expects it to set out the basis of the claim, a summary of the facts, what you want and how the amount is worked out. It gives 14 days as a reasonable time to reply in a straightforward case (paragraph 6).

Do I have to send one before going to court?

The court expects the parties to have followed the Practice Direction on Pre-Action Conduct before proceedings start. It will take a failure to do so into account when it manages the case and when it makes orders for costs (paragraph 13). Litigation should be a last resort: both sides should consider negotiation or another form of alternative dispute resolution, such as mediation, before proceedings start, and this letter invites the debtor to do so (paragraphs 8 to 11).

Can I use this letter if the debtor is an individual or sole trader?

No. This letter is for a debt owed by a company or other business only. If the debtor is an individual, including a sole trader, the Pre-Action Protocol for Debt Claims applies instead: your letter must enclose the Protocol's Information Sheet and Reply Form, and the debtor has 30 days to reply. The Late Payment of Commercial Debts (Interest) Act 1998 does not cover consumer debts at all. It does cover a sole trader's business debt, so you can still claim statutory interest from one, but the letter must then follow that Protocol, which this generator does not.

When does the 14-day deadline start?

The letter asks for payment within 14 days of the date printed on it, and it is dated the day you generate it. Send it that same day so the debtor gets the full 14 days.

Can I include interest and compensation?

Yes. The generator works out statutory interest and the fixed compensation sum under the Late Payment of Commercial Debts (Interest) Act 1998 from the amount and due date, and adds them to the total demanded. But if your contract already gives you a substantial remedy for late payment, statutory interest and the fixed compensation do not apply (unless the parties agree otherwise), and you should claim under the contract instead (sections 8 and 9). The fixed sum only arises once statutory interest runs (section 5A(1)).

Is this legal advice?

No. It is a general template, not legal advice. It does not check whether the debt is disputed or whether your contract changes what you can claim.

Free tool

Letter before action generator

A letter before action sets out what a business customer owes, including statutory interest and compensation, and gives it 14 days from the date of the letter to pay before you consider court action. It is for a debt owed by a company or other business only: if the debtor is an individual or sole trader, the Pre-Action Protocol for Debt Claims applies instead.

Figures last reviewed 27 September 2026

The debtor is a company or other business, not an individual or sole trader

A general template, not legal advice. Only for a debt owed by a company or other business: if the debtor is an individual or sole trader, the Pre-Action Protocol for Debt Claims applies instead, with 30 days to reply and its own Information Sheet and Reply Form. The letter gives 14 days from the date printed on it, so send it the same day you generate it. A debt more than six years overdue may be statute-barred; take advice before sending.

How this is calculated

Fill in your details and the debtor's, the invoice number and dates, and the outstanding amount, and confirm the debtor is a company or other business. The statutory interest and fixed compensation under the Late Payment of Commercial Debts (Interest) Act 1998 are worked out on our server from the amount and due date, using the Bank of England base rate that applies to the debt, and added to a ready-to-send PDF letter. To check the figures first, use the late payment interest calculator.

The letter gives the debtor 14 days from the date printed on it to pay, and it is dated the day you generate it, so send it the same day. It is a general template, not legal advice. It is only for a debt owed by a company or other business: if the debtor is an individual or sole trader, the Pre-Action Protocol for Debt Claims applies instead, with 30 days to reply and its own Information Sheet and Reply Form. The 1998 Act still covers a sole trader's business debt, but the letter must then follow that Protocol, so this generator is not the right tool. If your contract gives you a substantial remedy for late payment, statutory interest and the fixed compensation do not apply (unless the parties agree otherwise), under sections 8 and 9 of the 1998 Act.

A debt more than six years overdue may be statute-barred: in England and Wales a claim on a contract cannot be brought more than six years after the cause of action accrued (Limitation Act 1980, section 5). Take advice before sending a letter for a debt that old.

This letter is for debts governed by the law of England and Wales. Scotland and Northern Ireland have their own rules, including different time limits, so take advice there instead.

Sources

This tool is an illustration, not advice. Check your figures against the sources above, or ask your accountant, before relying on them.

Letter before action generator

Figures last reviewed 27 September 2026

The debtor is a company or other business, not an individual or sole trader

How this is calculated

This letter is for debts governed by the law of England and Wales. Scotland and Northern Ireland have their own rules, including different time limits, so take advice there instead.

This tool is an illustration, not advice. Check your figures against the sources above, or ask your accountant, before relying on them.

Letter before action generator

How this is calculated

Sources

Questions about the letter before action generator.

Letter before action generator

How this is calculated

Sources

Questions about the letter before action generator.