Debt recovery fees

In conducting uncontested debt recovery for business clients for sums of under £100,000 the firm operates a conditional fee (i.e. no win, no fee) arrangement up to obtaining a judgement in default.

Debt Recovery Fees

Our Team has handled thousands of cases and has years of experience in delivering high quality work in all matters relating to debt collection. For further information please see our team page.

The fees payable will be determined by any agreed fixed fees and/or the interest and costs recovered. Clients will be expected to fund disbursements (costs payable to another organisation) themselves.  

At the Letter of Claim stage, we charge a fixed fee for sending each letter. We will also retain any interest or statutory compensation recovered from the debtor. By way of two examples:

We charge our client £50 plus VAT* to send a Letter of Claim to a business debtor. In the Letter of Claim we include the outstanding invoice amount (e.g. £10,999). We also include interest (e.g. £98.45) and compensation (£100). If the debtor pays:

  1. Just the outstanding invoice amount, we will account the full invoice sum to our client. Our client’s only cost will be the £50 plus VAT* fee for sending the Letter of Claim.
  2. The invoice amount, interest and compensation, we will account the full invoice sum to our client and retain the interest and compensation paid by the debtor.

If we are instructed to issue Court proceedings, we will pay a Court issue fee on behalf of our client. The claim will include the outstanding invoice amount, the Court issue fee, any fixed costs, interest and compensation. If we make a recovery from the Defendant, our client will receive the full invoice amount back. Our fee will be the cumulative sum of the Court issue fee, fixed costs, interest and compensation. By way of an example:

We issue a claim for £4,250. We pay a Court issue fee of £205, which our client will pay on account. The claim includes the outstanding invoice amount, the Court issue fee, fixed commencement costs, interest and compensation. If the Defendant pays the full claim amount, our client will receive the full invoice amount and our fee will be the cumulative sum of the Court issue fee, fixed commencement costs, interest and compensation.

Further detail can be found on our fees page which gives a range of different prices depending on the value of debt.

The above does not apply to contested claims. All contested claims will be charged on a time spent basis at the applicable hourly rate. Further details can be provided on request.

Anyone considering instructing our Debt Recovery Team should be aware that the Court’s processing times change and are subject to long delays. The Court’s current processing times can be found on the following link.

Costs payable to another organisation:

  • Court fees
  • Trace fees: £50 – £350 plus VAT*
  • Land Registry fees: £3 – £40 plus VAT*
  • High Court Enforcement fees: £71 (no VAT) – £75 plus VAT*

The service includes the following steps:

  • taking instructions and reviewing documentation
  • sending a Letter of Claim
  • receiving payment and sending it to the client, or if the debt is not paid, drafting and issuing Court proceedings
  • where no Acknowledgement of Service or Defence is received, entering Judgment in Default and instructing High Court Enforcement Officers to take enforcement action as required

It does not include any steps for dealing with a contested claim following the service of a Defence. Any contested claims are dealt with by the Commercial Litigation Team and fees are incurred on a time spent basis at the applicable hourly rate.

Anyone wishing to proceed with a claim should note that:

  • the VAT* element of our fee cannot be reclaimed from your debtor
  • the costs quoted above do not include the costs of enforcement action, where this is needed to collect your debt .e.g. the costs of the High Court Enforcement Officers.  For details of the likely charges see “Costs payable to another organisation” above.

Timescales

For uncontested claims, it currently takes 4 – 10 weeks from the issue date to obtain Judgment in Default. However, the Court’s processing times vary so it can take more or less time depending on how quickly the Court process each claim. If enforcement action is needed, the matter will take longer to resolve.

*VAT is currently charged at 20%.

They make an effort to get to know your business and understand its complexities and intricacies in order to give you the best advice for your situation.

Legal 500 [UK 2024]

Top Tier firm Legal 500 UK 2024
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