Debt Recovery Costs and Fees
The following outlines the costs and fees in a debt recovery process where both parties are acting in the course of business and the debtor is a limited company, partnership or sole trader.
Initial stage
Please note: these costs apply when your claim is related to an unpaid invoice and is not yet disputed.
A letter before action (LBA) will be sent to your debtor at the registered address or business address. This letter will demand payment of the outstanding sum including interest and debt collection costs under the Late Payment of Commercial Debts (Interest) Act 1998.
| Debt Value | LBA | VAT | Total * |
|---|---|---|---|
| Up to £5,000 | £10 | £2 | £12 |
| £5,001 - £10,000 | £15 | £3 | £18 |
| £10,001 and above | £20 | £4 | £24 |
Court stage
Should payment not be made within 7 days of the date of the LBA, the costs and fees should you wish to issue proceedings are:
| Debt value (based on amount claimed plus interest) | Court fee * | Our fee (this fee is subject to an additional £15 for each additional defendant) | VAT on our fee (subject to the addition of defendants) | Total ** |
|---|---|---|---|---|
| Up to £300 (must exceed £25) | £25 | £50 | £10 | £85 |
| £300.01 - £500 | £35 | £50 | £10 | £95 |
| £500.01 - £1,000 | £60 | £70 | £14 | £144 |
| £1,000.01 - £1,500 | £70 | £80 | £16 | £166 |
| £1,500.01 - £3,000 | £105 | £80 | £16 | £201 |
| £3,000.01 - £5,000 | £185 | £80 | £16 | £281 |
| £5,000.01 - £10,000 | £410 | £100 | £20 | £530 |
| £10,000.01 - £100,000 | 4.5% of the claim | £100 | £20 | £570 - £4,620 |
**These costs and fees are only a guideline as presented in the Civil Procedure Rules and as set out at https://www.gov.uk/make-court-claim-for-money/court-fees. These could be subject to change.
If the debtor fails to serve an acknowledgement of service within 14 days then judgment may be entered in default. If the debtor files the acknowledgement of service but fails to file the defence within a further 14 days then judgment may be entered in default. Our fees for entering judgment are:
| Debt Value | Debtor fails to file Acknowledgement of service | Debtor fails to file defence |
|---|---|---|
| Up to £5,000 (must exceed £25) | £22 | £25 |
| £5,000.01 and above | £30 | £35 |
If the matter becomes contested, it will take longer to resolve and our hourly fee rates will apply. These are set out below:
| Director Solicitor | £285 |
| Senior Solicitors (more than 4 years post qualification experience) | £195 |
| Solicitors and Legal Executives (less than 4 years post qualification experience) | £175 |
| Trainee Solicitors | £140 |
You will receive an estimate of these fees during this stage of the process as they are determined on a case to case basis. There could also be further court costs (E.g. If a judgment order is required).
Whilst we are happy to follow this process for all debt matters, for claims in debt exceeding £10,000 we would suggest that you instruct us to review the claim and advise on an hourly basis on the best method to obtain recovery.