If you’re a builder or trades business, you don’t need telling that late payments drain time, energy and profit. Getting paid faster isn’t about hassling customers – it’s about setting clear terms, issuing tight paperwork and removing excuses to delay. When quotes, contracts and invoices are crisp, consistent and simple to pay, money moves sooner and cashflow steadies. That lets you buy materials at the right price, pay the lads on time and take on better jobs with confidence.
We see the same blockers again and again: vague quotes, missing job references, muddled VAT treatment, retention confusion, and payment methods that make it hard to settle up. Sort those, and you’ll reduce the back-and-forth that slows everything down. There’s a bonus too – tidy invoicing makes you look more professional, which helps you win the next job. Howay, let’s get this sorted so your next month looks stronger than your last.
A quick sense-check on the rules while we’re here. The current VAT registration threshold is £90,000 of taxable turnover on a rolling 12-month basis (HMRC, 2024). If you’re under Construction Industry Scheme (CIS), standard deductions are 20% for registered subcontractors and 30% if unregistered, with 0% where gross payment status applies (HMRC, 2012 to present). And if a business customer pays late, you can charge statutory interest at 8% plus the Bank of England base rate unless your contract says otherwise (HMRC). We’ll link these below so you can double-check.
Getting paid faster: Practical checks before you quote
Start well and the invoice looks after itself. Before you price any job:
- Scope and exclusions: List what’s included and what’s not: Materials, Labour, Waste removal, Scaffolding.
- Milestones: Set staged payments: Deposit, Mid-point, Practical completion, Snagging.
- Retention: State any holdback and release dates: Retention, Release on Completion, Final release on Defects expiry.
- Customer details: Capture legal entity and billing info: Company name, Registered address, PO number.
Why it helps: clarity up-front kills disputes later and gives you checkpoints to invoice sooner.
Make your invoices unarguable
When an invoice lands with everything the customer’s accounts team needs, it gets approved without fuss:
- Clear references: Include: Job address, Site reference, PO, Project manager.
- Line items: Break down: Labour hours, Materials by supplier, Plant hire, Variations.
- Dates and proof: Attach: Signed timesheets, Delivery notes, Photos before/after.
- Terms on the face of it: Re-state: Due date, Bank details, Late-payment interest.
- Easy ways to pay: Offer: Bank transfer, Card, Direct Debit, Pay-by-link.
Tip: Put the due date in bold at the top – not buried in the footer – and use plain English. No one wants to decode “net monthly account”.
Get VAT and CIS right first time
Two common trip-ups:
- VAT domestic reverse charge: Many business-to-business construction supplies fall under the reverse charge – you do not charge VAT to a VAT-registered contractor who will onward supply. Your invoice must state the reverse charge applies, show the VAT rate, and that the customer will account for it. Get it wrong and queries stop payment.
- CIS deductions: If you’re a contractor, verify your subs and deduct at 30%, 20% or 0% as HMRC tells you. If you’re a subcontractor, make sure the contractor has your UTR and status, and that your invoices show labour and materials separately – deductions apply to labour only.
Getting these right removes the admin tennis that drags payments into next month.
Shorten the clock with smarter terms
You don’t have to accept “end of month plus 60”. Builders who get paid faster do a few simple things:
- Deposits as standard: 20-40% before you start on domestic jobs, staged payments on commercial.
- Milestone billing: Invoice immediately at each stage. Don’t wait for month-end – send it the day the scaffold is down.
- Approval in writing: Agree variations on email or WhatsApp before the work, then include the approval reference on the invoice.
- Late-payment fees: State your right to charge interest and recovery costs. You don’t have to use it every time – but it helps focus minds.
For bigger clients, ask to be set up as a supplier before work starts. Get POs raised early, and you won’t spend week three chasing vendor forms.
Reduce queries with a simple evidence pack
Most delays come from “can you resend X?”. Create a standard pack you attach to every claim:
- Proof of work: Before/after photos, sign-off sheet, job card.
- Proof of cost: Invoices for large materials or plant, especially on cost-plus.
- Compliance: Insurance certificates, RAMS summary, CSCS list if requested.
- Bank details: On letterhead and repeated on the invoice to avoid “wrong account” excuses.
Name your files clearly: INV-1023_PO4567_SiteHighSt.pdf beats invoice final v3.pdf every time.
Chasing that works (without burning bridges)
Polite, firm, consistent follow-up gets results. Suggested cadence:
- Day 0: Send invoice with evidence pack and a pay-by-link.
- Day 3: Friendly nudge: “Just checking this reached you and is queued for payment?”
- Day 7: Ask for payment run date and the approver’s name.
- Day 1 past due: Short, firm note referencing terms and the planned payment date.
- Day 7 past due: Final reminder noting statutory interest and next steps.
Keep it respectful – you want repeat business – but don’t be shy. You delivered the work. Payment is not optional.
Tech that speeds things up
You don’t need fancy software, just tools that remove friction:
- Quote-to-invoice apps: Send quotes, convert to jobs, then to invoices in a tap – less retyping, fewer mistakes.
- Card and pay-by-link: Great for domestic clients and small commercial jobs – customers can settle on site.
- Direct Debit for maintenance: Monthly service or aftercare plans collect themselves.
- Job photos and e-sign: Evidence and approvals captured as you go, not hunted down later.
If you want help picking tools that fit your setup and budget, we can advise and get them up and running for you.
A quick reality check on the rules that affect cashflow
Here are three points worth bookmarking:
- VAT registration threshold: The compulsory registration threshold is £90,000 from 1 April 2024 (HMRC, 2024). If you’re near the line, track turnover monthly and plan your pricing.
- CIS deduction rates: 30% for unregistered subcontractors, 20% for registered, 0% with gross payment status – shown on invoices correctly so money isn’t over-deducted (HMRC).
- Late payment interest: You can charge 8% plus the Bank of England base rate on late B2B invoices unless your contract sets a different rate (HMRC).
These aren’t there to be scary – they’re levers to protect your cash and keep the business steady.
Ready to get paid quicker, like?
Strong invoicing is a habit – set clear terms, show your evidence, and make it easy to pay. Getting paid faster comes from removing all the reasons someone might delay: unclear scope, missing POs, wrong VAT, no milestone plan, or bank details nowhere to be seen. Tidy those, and your debtor days drop. Keep your chase polite, logged and predictable, and you’ll train even the slow payers to treat you properly.
If you want a hand tightening your quote-to-cash process, we’re here for it. We work with builders across the North East to put in staged billing, clean invoice templates and simple payment options – then we train the team so it sticks. If getting paid faster is top of your list, let’s talk. Book a free chat and we’ll map out what to fix first, what to automate and what to stop doing.