Invoicing and taking payment from customers

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Payment - obligations

Your right to be paid

You can set your own payment terms, such as discounts for early payment and payment upfront.

Unless you agree a payment date, the customer must pay you within 30 days of getting your invoice or the goods or service.

You can use a statutory demand to formally request payment of what you’re owed.

Charging interest for late payment

You have the right to charge interest for late payment, but you can choose not to.

Liability for disputed card payments

If a customer asks their credit or debit card issuer to reverse a transaction, they can reclaim the value of the transaction from you. This is known as a ‘chargeback’.

Chargebacks can be made when:

  • the purchased item never arrived
  • the item wasn’t as described
  • a customer’s card was used without their permission to purchase the item fraudulently.

You can be charged up to 120 days after the transaction has been debited or from when the goods or services were due to be received.

Minimising chargebacks

If a customer uses their PIN, you’ll only be liable for a chargeback if the goods are faulty or aren’t as described.

Where you can’t accept a PIN, a clear signature will help but there is no guarantee against a chargeback.

For card-not-present transactions, such as online sales, the risks of chargeback will be higher.


If you want to set up a business that takes a sum of money from a customer every time they use a service, for example, online trading, you may need to be authorised by the Financial Conduct Authority.

If customers pay you in large amounts of cash, your business may need to be registered for an anti-money laundering scheme.

Protecting customer data

You must follow the rules on storing customer data to protect their financial information.