In this article
You can agree 60 days. For a private-sector customer the law lets a longer period stand only if it is not grossly unfair to you, and for a public authority the period cannot run past 30 days. If you do agree it, price it, put a mandate behind it, and make the clock start on the day you invoice, not the day they get round to processing it.
Sixty-day terms are usually a cash flow decision dressed as a procurement rule.
The short version
- Agreed terms govern, but not without limit. For a non-public purchaser a period beyond 60 days stands only if it is "not grossly unfair to the supplier".
- For a public authority the relevant day cannot fall later than 30 days.
- The clock runs from the later of performance and notice of the amount, so a late invoice is your own delay.
- Statutory interest at base rate plus 8% still applies, currently 11.75%.
- A mandate turns 60 days into a date instead of a decision.
The short answer
Say yes if the work is worth it, and then make three things true: the price reflects the delay, the collection is automatic on day 60, and the 60 days starts when you invoice.
What the law allows
The starting position is that whatever you agree applies. Two limits sit on top of it, both in section 4 of the Late Payment of Commercial Debts (Interest) Act 1998.
Subsection (2D) stops a public authority going beyond 30 days: "Where the purchaser is a public authority, and the last day of the relevant 30-day period falls earlier than the agreed payment day, the relevant day is the last day of the relevant 30-day period".
For everyone else the reference point is 60 days. Subsection (2E) does the same job with a 60-day period, but subsection (2F) then disapplies it where "the agreed payment day is not grossly unfair to the supplier". So a longer agreed period stands unless it's grossly unfair to you.
What that means in practice: 60 days agreed with a private company is ordinarily enforceable. Ninety or 120 days is where the argument starts, and the test is fairness to you, not a fixed number.
Before you agree
Three things are worth doing before you say yes.
Work out what the delay costs you. Sixty days instead of 30 is a month of your money funding their working capital. On a £20,000 invoice at a 10% cost of capital that's roughly £165. Small on one invoice, and not small across a year of them.
Ask what the 60 days is actually for. Sometimes it's a genuine payment run. Often it's a default in a procurement template that nobody has been asked to change, so it's worth one question.
Then decide your price. If their terms are fixed, your number isn't. A discount for 14-day payment is easier to agree than a rate rise, and it moves the same money.
Step by step
If you've said yes, here's what to get right, and most of it happens before you send anything.
- Get the terms into the contract and not onto the invoice. An invoice isn't the place to negotiate, so if 60 days is agreed, it's agreed in writing before the work starts.
- Pin down when the 60 days starts. The statutory default runs from the later of performance and notice of the amount, so say plainly that the period runs from the invoice date, and make sure your invoice goes out the day the work completes.
- Establish who approves and who pays. A 60-day term with a two-week internal approval step is a 74-day term, so ask for both names at the start.
- Put a mandate behind it. A direct debit collecting on day 60 turns the term into a date. Without one, day 60 is when somebody starts thinking about it.
- Invoice immediately, every time. With long terms your own delay is the most expensive part of the cycle, and it's the only part you control.
- State the interest position on the invoice, not as a threat. The statutory right applies whether or not the contract mentions it, and saying so sets the expectation early.
- Diarise a check at day 45. Not a chase, just a confirmation that your invoice is approved and scheduled, while there's still time to fix a problem before the due date.
- Review the arrangement every year. Long terms tend to survive the reason they were agreed for.
If you have already agreed
You can still improve your position without renegotiating the term at all.
Ask to be moved onto direct debit for future invoices. Get the approval step confirmed in writing so your 60 days doesn't quietly become 75. Invoice on the day, not at the month end. And if the invoice does go past due, statutory interest at base rate plus 8% applies, currently 11.75%, along with fixed compensation of £40, £70 or £100 depending on the size of the debt.
If the terms were imposed on you instead of negotiated, and they're hurting, the grossly unfair test in subsection (2F) exists for exactly that situation, and it's worth taking advice before you assume the contract is the end of it.
Common questions
Are 60-day payment terms legal in the UK? Yes, if agreed. For a private-sector purchaser a period beyond 60 days stands only where it is not grossly unfair to the supplier. For a public authority the relevant day cannot fall later than 30 days.
Can a customer impose 60-day terms on me? They can require them as a condition of the contract, and you can decline the contract or price the delay. What they cannot do is extend the period so far that it becomes grossly unfair to you.
Do 60-day terms start from the invoice date? Only if you agree that. The statutory default runs from the later of the day you performed the work and the day the customer had notice of the amount owed, so put the trigger in the contract explicitly.
Can I still charge interest on a 60-day invoice? Yes, once it is late. Statutory interest runs from the day after the due date at base rate plus 8%, and applies whether or not your contract mentions interest.
How much does waiting 60 days actually cost? The extra 30 days over standard terms costs roughly your cost of capital for a month on the invoice value. On £20,000 at 10% a year that's about £165 per invoice.
What is the best way to make long terms work? Collect by direct debit on the due date, invoice the day the work completes, and confirm approval before the due date rather than chasing after it.
Sources
- legislation.gov.uk — Late Payment of Commercial Debts (Interest) Act 1998, section 4 (accurate as of August 2026)
- GOV.UK — charging interest on a commercial debt (accurate as of August 2026)
- GOV.UK — claim debt recovery costs (accurate as of August 2026)
Reviewed by the Adfin team. This article explains how UK payment terms work and is not legal advice. The statutory rate moves with the Bank of England base rate; check the current position before relying on any figure. Last updated August 2026.
