Letter Before Action for an unpaid invoice — how to write one (UK)

What a Letter Before Action is

A Letter Before Action (also called a letter before claim or LBA) is a formal letter telling a debtor that unless they pay what they owe by a stated deadline, you will start court proceedings against them without further notice. It is not a court document and it doesn't need legal language — it's a clear, factual statement of the debt and your intention.

It matters for two reasons. First, it's effective: by the time an invoice has survived a month of chasing, the debtor has learned to ignore reminders — but a Letter Before Action signals that the next step is a County Court claim, a judgment, and potentially a mark on their credit record. Faced with that, most debtors pay. In our experience the LBA resolves more stubborn invoices than every other chase email combined.

Second, it's required. The courts in England and Wales expect parties to follow pre-action rules before issuing a claim — set out your case, give the debtor a fair chance to respond, try to resolve it without proceedings. If you sue without doing this, the court can penalise you on costs even if you win. The Letter Before Action is how you satisfy that requirement.

When to send one

The standard trigger is an invoice around 30 days overdue where your chases have been ignored, or answered with promises that weren't kept. Sending it earlier than that can look heavy-handed; much later and you've taught the debtor that your deadlines are decorative. If you've already sent two or three escalating chases citing the Late Payment Act and the total keeps being ignored, you have nothing left to gain from another reminder — escalate.

One exception: if the client has raised a genuine, specific dispute about the work, deal with the dispute first. A Letter Before Action that ignores an open dispute looks bad if the matter ever reaches a judge.

The legal requirements depend on who owes you

There are two regimes, and it's worth getting this right because the response windows differ:

Debtor is an individual or sole trader

The Pre-Action Protocol for Debt Claims applies whenever a business claims a debt from an individual — and that includes sole traders. Under the Protocol your letter must give the debtor 30 days to respond, and you must enclose the official Information Sheet and Reply Form (available from the Ministry of Justice's published Protocol). The letter should also state the amount, how it arises, the interest claimed, and how to pay. If the debtor returns the Reply Form saying they're seeking advice or need time, you're expected to allow it before issuing.

Debtor is a limited company

The Debt Protocol doesn't apply to company debtors. Instead the general Practice Direction on Pre-Action Conduct applies, which requires a proportionate exchange before proceedings but sets no fixed window. For a simple unpaid invoice, 14 days is the widely accepted standard deadline, and no Reply Form is needed. Most freelancer invoices fall into this category.

What to include

Every effective Letter Before Action contains the same elements:

• The words "Letter Before Action" (or "Letter of Claim") stated clearly at the top, so there's no ambiguity about what the letter is
• The parties — your name/business and theirs, with the invoice reference and date
• The exact amount owed, with a breakdown — principal, statutory interest, and the fixed recovery sum, each on its own line
• The legal basis — the contract or agreement, and the Late Payment of Commercial Debts (Interest) Act 1998 for the interest and fixed sum
• A specific deadline — a calendar date, 14 days out for a company, 30 for an individual or sole trader
• Payment details — account name, sort code, account number, reference. Don't make paying you require a reply
• The consequence — that if payment isn't received by the deadline, you will issue court proceedings without further notice, and will seek court fees and further interest on top

Getting the tone right

The letter should read like it was written by an accounts department, not by someone who's owed money and furious about it. That means:

• Factual and unemotional. Dates, amounts, references. No history of how patient you've been, no "frankly disappointed".
• No threats beyond the legal next step. Stating that you'll issue proceedings is the entire point of the letter. Threatening anything else — bad reviews, telling their clients, "consequences" — weakens it legally and practically.
• No hedging either. "We may consider possible further action" invites the debtor to keep stalling. "Court proceedings will be issued without further notice" does not.

A judge may one day read this letter. Write it for that audience and you'll automatically strike the right tone.

How to send it

Send it both by email and by post. Email gives you an instant timestamp; the posted copy — to the company's registered office, which you can check on Companies House — defeats any later claim that the letter never arrived. Get free proof of postage at the Post Office counter (recorded delivery is fine too, but a refused signature can delay things; proof of postage is enough).

Keep copies of the letter, the proof of postage, and the sent email. Together with your invoice and earlier chases, that's the complete paper trail a court claim needs.

What happens next

Three outcomes, in descending order of likelihood:

• They pay. The most common result, often within days. Some debtors will pay the principal but "forget" the interest and fixed sum — it's your call whether to chase the balance, but remember it's money the law says you're owed.
• They respond disputing the debt or asking for time. Engage, in writing. A genuine dispute needs answering before court; a payment plan is fine if it's written down with dates, with interest continuing to accrue. The pre-action rules expect you to be reasonable here, and being reasonable on paper only strengthens your position.
• Silence. Once the deadline passes, issue your claim — for debts under £10,000 the online money claim service on gov.uk takes around 20 minutes, the fee is added to the debt, and undefended claims (which most are) proceed to judgment without you setting foot in a courtroom.

Don't write it from scratch

The structure above is standard, and there's no benefit to reinventing it. Hielda publishes a free Letter Before Action template with the statutory wording, the breakdown layout, and the deadline phrasing done for you — copy it, fill in your numbers, and send. And if you'd rather never reach this stage at all, Hielda's automated chasing runs the whole escalation sequence from first reminder onwards, calculating the daily interest and fixed sum as it goes, so the formal letter is a rare last resort rather than a regular chore.