Provisions the documents cite: s.1 (statutory interest implied), s.4 (period for which statutory interest runs), s.5A (fixed-sum compensation and reasonable recovery costs)
What it requires
s.1 — a contract to which the Act applies carries an implied term that a qualifying debt created by it carries simple interest ("statutory interest"). s.4 — statutory interest runs from the day after the relevant day: the agreed payment day or, where none is agreed, the last day of the 30-day period beginning with the later of performance of the supplier's obligation and the purchaser's notice of the amount. Where the purchaser is a public authority and the 30-day period ends before the agreed payment day, the relevant day is the end of the 30-day period. Where the purchaser is not a public authority and a 60-day period ends before the agreed payment day, the relevant day is the end of the 60-day period unless the agreed day is not grossly unfair to the supplier. An acceptance or verification procedure delays the start, but not beyond 30 days after performance unless a longer period is expressly agreed and is not grossly unfair. s.5A — once statutory interest begins to run the supplier is also entitled to a fixed sum of £40 for a debt under £1,000, £70 for a debt of £1,000 or more but under £10,000, and £100 for £10,000 or more, plus its reasonable recovery costs so far as the fixed sum does not meet them.
The instrument itself: https://www.legislation.gov.uk/ukpga/1998/20. The summary above is our plain-English reading, not the text of the instrument — always work from the source.
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The 4 documents that cite it
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