payment-terms-ask

---
name: payment-terms-ask
description: Turns your supplier list and your unpaid sales invoices into one dated terms register, reads the published payment record of every large company you buy from or sell to, and writes the actual ask, with the statutory backstop priced before you send it. Use before you sign a new supply account, when a wholesaler shortens your terms, or when a corporate customer has stopped paying on time.
---

# The terms you ask for, backed by the law and by their own published payment record

You give this your supplier accounts with the terms you currently have, your unpaid sales invoices, and the names of the larger businesses on both sides. You get back a terms register with real dates, the statutory position for each relationship written out, the published payment performance of any large counterparty read from the government service, a one page ask you can send, and the escalation route with a date against it. It does not chase anyone, send anything, or tell you that a term is legally enforceable.

## What it does

1. **Split the list into money out and money in before anything else, because different rules bind each side.** Money out is the brewery, the food wholesaler, the linen contract, the gas supply, the till provider. Money in is the corporate account, the party booking invoiced after the event, the office lunch contract, the agency that block books rooms. The Late Payment of Commercial Debts (Interest) Act 1998 protects whoever is owed, so it protects your suppliers against you on one side of the list and protects you against your customers on the other. An owner who applies it in one direction only will either chase a customer they cannot chase or agree a supplier term that exposes them.

2. **Write down the terms you actually have, from the document, not from memory.** One row per account: the counterparty's full registered name, the company number, the written payment term as the contract states it, where that document is, the date it was signed or last varied, and who signed. Terms in hospitality drift by conversation. A rep says thirty days, the account opens on fourteen, the statement says seven, and nobody looks until a delivery is held. If no document can be produced for an account, the row says "no written term located" rather than the number the owner believes. That gap is the finding, and it is usually the account causing the trouble.

3. **Fix the legal default before you ask for anything, because it is the floor under every negotiation.** Section 4 of the 1998 Act sets when interest starts. Where the purchaser is not a public authority and the parties have agreed a date, subsection (3B) treats a relevant day more than thirty days after the default day as being thirty days after it, and the longer periods available under the Act are subject to the test in subsection (7A): whether something is grossly unfair is judged on all the circumstances, including "anything that is a gross deviation from good commercial practice and contrary to good faith and fair dealing", the nature of the goods or services, and whether the purchaser has any objective reason to depart from the default. GOV.UK states the working rule plainly: "If you agree a payment date, it must usually be within 30 days for public authorities or 60 days for business transactions." So sixty days is the outer edge of ordinary practice, not a starting bid.

4. **Read the large counterparty's own published payment record before you write a word of the ask.** Under regulations made under the Small Business, Enterprise and Employment Act 2015, large companies and LLPs must publish payment data twice a year on a government service, and the thresholds from 6 April 2025 are "£54 million annual turnover", "£27 million balance sheet total" and "250 employees", with two of the three putting a business in scope. Reports must be published "within 30 days of the end of the reporting period", and missing that is "a criminal offence by the business, and every director". Search the business at the government's own service, not at an aggregator. You get the average days taken to pay, the split paid in thirty days or fewer, thirty one to sixty and sixty one or longer, the percentage paid late, their standard terms, their maximum contractual payment period and their dispute process.

5. **Compare what they publish with what they are offering you, and quote the gap back to them.** This is the single move that changes a conversation, and almost no independent venue makes it. If a wholesaler's report says its standard term is thirty days and it has put you on seven, you are being treated worse than its own published policy. If a corporate customer's report says twenty two per cent of payments took sixty one days or longer, you now know what your Christmas party invoice is actually worth in January, and you can price a deposit accordingly rather than discovering it. Also check whether they hold a Fair Payment Code award. The Code, administered by the Office of the Small Business Commissioner, gives a Gold Award "for those firms paying at least 95% of all invoices within 30 days", Silver for ninety five per cent within sixty days including ninety five per cent of small business invoices within thirty, and Bronze for ninety five per cent within sixty. An awardee falling short of its own tier can be complained about.

6. **Write the ask as one page, with the number you want, the reason, and what you give back.** The Small Business Commissioner's negotiation guidance is the method here, and it is blunt: "Never take on work without knowing what the terms and conditions are, including the payment terms." It tells you to research the counterparty first, to listen for most of the conversation, not to concede "too much, too soon, or beyond your bottom line", to be prepared to walk away, and that "The first offer is rarely the final offer." Put the ask in writing whatever was said on the phone, because, in the Commissioner's words, "In the future, if there are disputes, you have the proof about what was agreed." Name what you give back: a standing order on a fixed date, a larger single weekly order, or direct debit.

7. **On the money in side, price the remedy before you threaten it, and never threaten it early.** Statutory interest on a late commercial debt is "8% plus the Bank of England base rate for business to business transactions", so the figure depends on today's base rate and must be looked up on the day rather than carried over from an old letter. On top of interest you may claim a fixed sum for recovery costs, and GOV.UK sets the bands as £40 for a debt "Up to £999.99", £70 for "£1,000 to £9,999.99", and £100 for "£10,000 or more". Work out the actual pounds for the actual invoice. On a £2,400 function invoice thirty days late the fixed sum is £70 and the interest is small, which is worth knowing before you spend a relationship on it.

8. **Fix the invoice itself, because a large share of late payment is a document problem, not a refusal.** The Commissioner's invoicing guidance lists what to get right: identify who actually pays rather than who booked, confirm the date the money will reach your account because terms like "30 days" vary, request a purchase order number early since "Delays in getting it will mean the invoice is submitted later than necessary", and send each invoice immediately rather than batching at month end, because batching "could leave you short of cash while waiting for several payments to come in". The essential fields are named: invoice date and number, purchase order number, the work it relates to, total fee with VAT detail, payment due date, the agreed terms, and bank details. Then call the week before it falls due.

9. **Set the escalation route with a date against it, and log the outcome.** Three stages, each with an owner and a calendar date: a polite reminder, a call to the named payer, then a final demand in writing. After that, for an unresolved dispute with a larger customer, the Office of the Small Business Commissioner "may be able to help", and its guidance places that step before legal action rather than after it. Court and collection agencies come last, and the guidance says to weigh "the costs and potential impact on the relationship with the client" first. Record what was agreed, by whom, on what date, and feed it back into the register in step 2 so the next negotiation starts from evidence.

## Then it checks

1. Every account has a row, and every row carries either a written term with the document named and dated or the words "no written term located", with no term recorded from memory.
2. Every large counterparty has been searched on the government payment practices service by registered name and company number, and the result recorded as a report found with its figures, or as no report found with the date searched.
3. Every statutory statement in the file quotes its source by section or page and carries the date that source was read, and any interest figure names the Bank of England base rate used and the date it was taken.
4. No demand for statutory interest or fixed recovery costs appears against an invoice that is not yet past its agreed payment date, and each fixed sum matches the band for that invoice value.
5. The ask sent to a supplier does not request a payment period beyond sixty days, or, where it does, states the objective reason and flags subsection (7A) as a question for the owner's accountant or solicitor.
6. Every escalation stage names a person and a calendar date, and no stage is recorded as complete without the date it happened and what was said.

Any check fails: name it, redo that step once. Failed twice: say what is wrong and stop.

## Rules
- Public information only.
- Never invent a fact, a number or a quote.
- Anything sent in someone's name says whose name it is. A chasing email written as though the owner typed it goes to the owner before it goes anywhere else.
- Never send, email, telephone or submit anything. This prepares letters and registers for the owner to send in their own name and on their own judgement.
- Never state the current statutory interest rate from memory. It moves with the Bank of England base rate, and a letter carrying last year's figure is a letter the customer can dismiss.
- Never state a benchmark, an average payment period or a typical terms figure for independent hospitality. No such published figure exists for a single venue, and an owner who negotiates against an invented average will either give ground they did not need to or hold out for something nobody offers.
- Never treat a payment practices report as a statement about how you will be paid. It is a published average across every supplier that counterparty has, it is historic, and it says nothing about your account.
- Must refuse to draft any letter asserting that a term is unenforceable, that a counterparty is in breach, or that a deduction can lawfully be made. Those are conclusions for the owner's solicitor.
- This output is a working document prepared for the owner's accountant, solicitor or trade body to check before it is sent or relied on. It gathers published rules, records what the owner holds and names the gaps. It is not legal advice and it does not decide any dispute.

## Built from
- Late Payment of Commercial Debts (Interest) Act 1998, section 4, https://www.legislation.gov.uk/ukpga/1998/20/section/4, read 16 September 2026: the thirty day treatment in subsection (3B) and the grossly unfair test in subsection (7A), both in step 3.
- GOV.UK, "Late commercial payments: charging interest and debt recovery", https://www.gov.uk/late-commercial-payments-interest-debt-recovery, and its pages "Charging interest on a commercial debt" and "Claiming debt recovery costs on a late commercial payment", no publication date shown on the pages, read 16 September 2026: the thirty and sixty day working rule in step 3, and the 8% plus base rate figure and the £40, £70 and £100 bands in step 7.
- Department for Business and Trade, "Duty to report: guidance to reporting on payment practices and performance", https://www.gov.uk/government/publications/business-payment-practices-and-performance-reporting-requirements/duty-to-report-guidance-to-reporting-on-payment-practices-and-performance, updated 2 September 2025, read 16 September 2026: the £54 million, £27 million and 250 employee thresholds, the thirty day filing period, the criminal offence, and the exact list of statistics and narrative descriptions a report contains, all in step 4.
- GOV.UK, "Check when large businesses pay their suppliers", https://www.gov.uk/check-when-businesses-pay-invoices, no publication date shown on the page, read 16 September 2026: the public search service step 4 sends the owner to, and its own statement of what the reports show.
- Office of the Small Business Commissioner, "About" the Fair Payment Code, https://www.smallbusinesscommissioner.gov.uk/fpc/about/, no publication date shown on the page, read 16 September 2026: the Gold, Silver and Bronze thresholds and the complaints route in step 5.
- Office of the Small Business Commissioner, "How to negotiate terms and conditions", https://www.smallbusinesscommissioner.gov.uk/help-and-guidance/all-advice/how-to-negotiate-terms-and-conditions/, no publication date shown on the page, read 16 September 2026: the negotiating method and the put it in writing rule in step 6.
- Office of the Small Business Commissioner, "Getting invoices right", https://www.smallbusinesscommissioner.gov.uk/help-and-guidance/all-advice/getting-invoices-right/, no publication date shown on the page, read 16 September 2026: the invoice field list, the purchase order point and the do not batch point in step 8.
- Office of the Small Business Commissioner, "Help with unpaid invoices", https://www.smallbusinesscommissioner.gov.uk/help-and-guidance/all-advice/help-with-unpaid-invoices/, no publication date shown on the page, read 16 September 2026: the ordered escalation in step 9 and the position of the Commissioner before legal action.

# payment-terms-ask

## You are given
A folder for one UK hospitality business. It contains: a list of supplier accounts, each with the counterparty's registered name, company number where known, the written payment term copied verbatim from the account document, the filename of that document, and the date it was signed or last varied. A list of unpaid sales invoices, each with customer name, company number where known, invoice number, invoice date, the date the invoice was received by the customer if known, the agreed payment date, the gross amount in pounds, and whether a purchase order number was quoted. For every counterparty already searched on the government payment practices service, a text file holding the figures as read: average days to pay, percentage paid in 30 days or fewer, percentage 31 to 60 days, percentage 61 days or longer, percentage not paid within agreed terms, the stated standard payment terms, the maximum contractual payment period, and the reporting period the report covers. The Bank of England base rate as a percentage with the date it was read. Any Fair Payment Code award tier recorded for a counterparty. And, already decided by Claude and supplied as text, the ask to be made on each account, the reason for it, what is offered in return, and the three dated escalation stages for each unpaid invoice.

## Produce
Write into a `./payment-terms-ask-output/` folder:

1. `terms-register.csv` with these columns in this order: `row_ref`, `direction`, `counterparty_name`, `company_number`, `written_term_verbatim`, `term_days`, `source_document_filename`, `document_date`, `signed_by`, `term_evidenced`. `row_ref` is T001 upward. `direction` is exactly one of `money out` or `money in`. `term_evidenced` is exactly `yes` or `no written term located`. Where `term_evidenced` is `no written term located`, `written_term_verbatim` and `term_days` are left empty and never filled with an assumed figure.
2. `counterparty-payment-records.csv` with columns: `row_ref`, `counterparty_name`, `company_number`, `search_date`, `report_found`, `reporting_period`, `average_days_to_pay`, `pct_paid_30_days_or_fewer`, `pct_paid_31_to_60_days`, `pct_paid_61_days_or_longer`, `pct_not_paid_within_agreed_terms`, `stated_standard_terms_verbatim`, `maximum_contractual_period_verbatim`, `fair_payment_code_tier`. `report_found` is exactly `yes` or `no`. `fair_payment_code_tier` is exactly one of `Gold`, `Silver`, `Bronze`, `none recorded`.
3. `terms-gap.csv` with columns: `row_ref`, `counterparty_name`, `their_published_standard_term_days`, `our_term_days`, `gap_days`, `we_are_treated_worse`, `evidence_line`. `gap_days` is their published term minus our term, computed not estimated. `we_are_treated_worse` is `yes`, `no` or `cannot compare`. Use `cannot compare` wherever either figure is missing, never zero.
4. `late-payment-position.csv` with columns: `invoice_number`, `customer_name`, `invoice_date`, `agreed_payment_date`, `days_overdue_today`, `gross_amount_gbp`, `is_overdue`, `fixed_sum_band`, `fixed_sum_gbp`, `base_rate_pct`, `base_rate_read_date`, `statutory_rate_pct`, `daily_interest_gbp`, `interest_to_date_gbp`. `is_overdue` is `yes` or `no`. `fixed_sum_band` is exactly one of `up to £999.99`, `£1,000 to £9,999.99`, `£10,000 or more`, `not applicable`. Where `is_overdue` is `no`, every interest and fixed sum column is `not applicable` and no figure is written.
5. `the-ask.md` - one section per supplier account, each containing only the ask, the reason, and what is offered in return, copied verbatim from the supplied text, under a heading naming the counterparty and the date. Nothing is rewritten, shortened or improved. Accounts with no supplied ask are omitted here and listed in `gaps.md`.
6. `escalation-diary.csv` with columns: `invoice_number`, `stage`, `stage_owner`, `planned_date`, `actual_date`, `what_was_said`, `outcome`. `stage` is exactly one of `polite reminder`, `call the named payer`, `final demand in writing`, `refer to the Office of the Small Business Commissioner`, `legal or collection`. `actual_date`, `what_was_said` and `outcome` are left empty until the owner fills them.
7. `gaps.md` - a numbered list of: every account with no written term located; every counterparty not yet searched on the payment practices service; every counterparty searched with no report found; every unpaid invoice with no agreed payment date recorded; every invoice with no purchase order number where the customer's own process requires one; every supplier ask that would exceed 60 days; every account with no supplied ask; and any base rate older than the run date.

## Rules
- Codex measures, records and checks. It never invents, never rewords the owner's copy, and never makes the judgement that was supplied to it.
- Never calculate interest or a fixed recovery sum for an invoice whose agreed payment date has not passed. That row is `not applicable`, and writing a figure there is the defect this file exists to prevent.
- Never write a statutory interest rate that was not derived from a supplied base rate with a read date. The rate is the supplied base rate plus 8 percentage points, computed in the file, and the base rate and its date appear on every row that uses it.
- Never fill a missing term, a missing published figure or a missing date with an assumption, a sector average or a zero. Missing is recorded as missing and listed in `gaps.md`.
- Never write a benchmark, an industry average payment period, or a claim that a given term is typical for hospitality. No such published figure exists for a single independent venue and none is to be written into any file.
- Never write that a term is unenforceable, that a counterparty is in breach, or that money can lawfully be withheld. Record the facts and the dates only.
- Never send, email, submit or transmit anything, and never contact a counterparty.
- Every quoted term, published figure or code tier is copied exactly as it appears in the source, including punctuation and capitalisation, and carries the date it was read.
- Use British English, £ and DD Month YYYY dates. No em dashes in any file you write, and any supplied text containing one is recorded verbatim and flagged in `gaps.md`.
- Every file ends with this line: this is a working document prepared for the owner's accountant, solicitor or trade body to check before it is sent or relied on. It records supplied facts and published rules and is not legal advice or a decision on any dispute.

## Return
The absolute path of each file written, the row count of each CSV, the number of accounts split by `money out` and `money in`, how many rows carry `no written term located`, how many counterparties were searched and how many returned a report, the number of rows where `we_are_treated_worse` is `yes` and the largest `gap_days` with the counterparty named, the count of invoices where `is_overdue` is `yes` with the total gross overdue in pounds and the total fixed recovery sums, the base rate used and the date it was read, the number of sections written into `the-ask.md`, the number of escalation stages with a planned date, and the `gaps.md` item count.