The Average Tradesperson is Chasing Over £6,000 in Late Payments 

Late payments remain one of the biggest financial headaches for self-employed tradespeople in the UK. New figures suggest that the average spark or contractor is chasing more than £6,000 in overdue invoices — a figure that h ighlights just how serious the cash flow problem has become. 

For electricians, who often need to cover up-front costs for materials and labour, late payments can derail projects, affect earnings, and add unnecessary stress. Let’s explore the scale of the problem, its impact, and the steps that can help reduce the risks. 

How Many Tradespeople Are Affected? 

According to research by insurer Direct Line: 

• 81% of tradespeople are currently owed money. 

• The average unpaid amount stands at £6,210. 

• 73% are chasing multiple outstanding invoices, with an average of seven per tradesperson. 

• 42% said they are pursuing more late payments than this time last year. 

The reasons are varied. Rising living costs, tighter customer budgets, and disputed invoices all play a role. Alarmingly, half of tradespeople surveyed reported an increase in clients challenging or disputing invoices — often creating even longer delays. 

Financial and Personal Impact 

Late payments hit tradespeople hard. For electricians, the upfront costs of materials and site labour often come straight out of pocket. Without prompt payment, they may struggle to take on new jobs or purchase the kit needed for their next project. 

• 22% of tradespeople said chasing payments takes up time that should be spent working. 

• This can lead to fewer paid hours, missed opportunities, and r educed income. 

The mental health toll is also severe: 

• 32% reported feeling anxious. 

• 22% said it left them stressed. 

• 17% admitted feeling overwhelmed. 

For self-employed sparks without paid sick leave, these pressures can quickly become unsustainable. 

How Electricians Can Reduce the Risk 

While no method can guarantee payments arrive on time, there are practical steps to minimise delays: 

• Request immediate payment on-site after completing work, using mobile payment devices or BACs transfers. 

• Be clear with payment terms — due dates, interest rates, and late fees should be outlined on invoices or contracts. 

• Send invoices promptly so the payment clock starts right away. 

• Use invoicing software to automate reminders and streamline the process. 

• Maintain communication with customers to reduce disputes or misunderstandings. 

For electricians thinking about starting their own business, understanding financial risks is as important as technical training. See 10 reasons why you should become an electrician for an overview of the career benefits — and how to prepare for challenges like this. 

Government Support and Fair Payment Code 

The UK Government has recently launched the Fair Payment Code, replacing the previous Prompt Payment Code. The scheme aims to encourage fairer treatment of suppliers by: 

• Awarding Bronze, Silver, or Gold ratings to businesses based on promptness of payments. 

• Requiring companies to publicly report their payment practices. 

• Encouraging self-employed tradespeople to check a company’s status before agreeing contracts. 

While this won’t directly solve issues with private domestic customers, it is a positive step for c ontractors working with larger firms. The Government also provides a Business Support Helpline (0300 456 3565), offering advice on legal rights and claims processes. 

For sparks keen to strengthen their career resilience, see How to utilise social media effectively as an electrician. Building visibility and trust online can help secure better-paying, more reliable clients. 

The Bigger Picture for Trades 

The issue of late payments doesn’t just affect today’s jobs — it threatens the long-term stability of the sector. Electricians, builders, and other contractors are vital to the UK economy, yet too many are left waiting months for the money they’ve earned. 

High levels of unpaid invoices mean tradespeople cannot invest in training, apprenticeships, or new technology. This in turn could impact future skills growth, at a time when demand for electricians is rising. For sparks weighing career prospects, our guide on 18th Edition Amendment 2 updates shows how staying current with regs is one way to remain competitive in a tough market. 

Why This Matters for Electricians 

With the average electrician already balancing training costs, tools, insurance, and transport, unpaid invoices can be devastating. Van leasing or finance arrangements, for example, require reliable monthly income. For more on this, see Van leasing for sparkies. 

Ultimately, electricians need strong business habits alongside technical expertise. From invoicing systems to customer management, handling the financial side of the trade is just as critical as wiring and testing. 

At Elec Training, we know that becoming a successful spark means combining practical skills with business awareness. Our courses and resources are designed to support both aspects, helping learners and experienced tradespeople alike to thrive. 

The late payment problem won’t disappear overnight, but awareness, preparation, and government support are steps in the right direction. For electricians, staying professional, organised, and proactive about payments can make the difference between financial stress and long-term stability. 

1 – How much are UK electricians typically owed in late payments?

UK electricians, as part of the broader trades sector, face significant financial strain from late payments, with recent data highlighting the scale of the issue in 2025. According to the 2025 Intuit QuickBooks Small Business Late Payments Report, small businesses—including electrical contractors—are owed an average of £21,400 in unpaid invoices, with 54% of these exceeding 30 days overdue. For trades specifically, IronmongeryDirect’s 2024 survey (still relevant for 2025 trends) found electricians lose over £815 annually from withheld payments, occurring an average of 2.5 times per year, with 20% writing off debts as losses. Direct Line’s 2023 research reported tradespeople chasing an average of £6,984 in overdue amounts, impacting cash flow and leading to 31% struggling with wages or employee payments. These figures underscore how late payments, often tied to customer financial difficulties, can erode profitability, especially for self-employed electricians reliant on steady inflows for tools and materials. 

2 – What’s the most common reason customers delay paying tradespeople?

The most common reason customers delay paying tradespeople, including electricians, is their own financial difficulties, often exacerbated by economic pressures like rising costs and market uncertainty. A 2023 Ivalua study of 850 procurement leaders across the UK and Europe found 52% of businesses delayed supplier payments due to higher costs, with payments averaging 22 days later than before—21% over a month late. IronmongeryDirect’s survey echoed this, noting customer cash flow issues as the top cause, leading to withheld payments that waste trades’ time and resources. Other frequent excuses include lost or forgotten invoices (affecting 23,000+ claims in ABC-Amega’s 2024 data), disputes over work quality, or stalling tactics to extend cash retention. For electricians, this often manifests post-job, where clients cite unexpected expenses, prompting proactive measures like credit checks via Experian to vet clients upfront. 

3 – How long can an electrician legally wait before charging late fees?

Under the UK’s Late Payment of Commercial Debts (Interest) Act 1998, electricians can charge late fees immediately once a payment becomes overdue, typically 30 days after invoicing or service delivery (whichever is later) if no terms are specified. The Act deems payments late as soon as the agreed timeline expires—often 30 days for B2B work, or up to 60 days if fair to both parties. GOV.UK guidance confirms interest (8% above Bank of England base rate) and compensation (£40-£100 based on debt size) accrue from day one of overdue status, without prior warning. For domestic clients, while the Act applies less directly, contracts can stipulate similar terms. Electricians should include clear payment dates in quotes to trigger this statutory right, avoiding delays that compound cash flow issues. 

4 – Can electricians add interest to overdue invoices?

Yes, UK electricians can legally add interest to overdue invoices under the Late Payment of Commercial Debts (Interest) Act 1998, applicable to B2B transactions including sole traders. Statutory interest is 8% above the Bank of England base rate (e.g., 13% if base is 5%), calculated daily from the day after due date until payment, plus fixed compensation (£40 for debts up to £999, £70 for £1,000-£9,999, £100 for £10,000+). GOV.UK and Crunch confirm no prior notice is needed, and claims can be made up to six years later. For domestic work, include interest clauses in contracts (e.g., 4% above base) to enforce via small claims court. Markel advises stating terms upfront to deter delays, with tools like the Small Business Commissioner’s calculator simplifying computations—helping electricians recover costs without alienating clients. 

5 – What invoicing software helps electricians chase payments?

In 2025, top invoicing software for UK electricians focuses on automation for reminders, QuickBooks integration, and mobile access to streamline chasing payments amid high demand. ServiceTitan leads with real-time invoicing, auto-reminders, and credit card processing from job sites, boosting revenue by 38% for users via GPS-tracked dispatching. Housecall Pro excels for residential work, offering quick invoice creation, payment tracking, and overdue alerts, saving 8+ hours weekly. Tradify provides branded templates, automatic chasers, and online payments, with 5-star reviews from thousands of electricians for reducing admin. Jobber integrates CRM and scheduling for 4x faster payments, while Workiz handles estimates to collections seamlessly. For free options, Wave or Quickfile suit solos, but premium tools like these (£20-£100/month) minimize disputes through e-signatures and analytics. 

6 – Does the Government’s Fair Payment Code apply to domestic customers?

No, the UK’s Fair Payment Code (launched December 2024, replacing the Prompt Payment Code) applies primarily to B2B transactions and does not cover domestic customers, focusing on improving supply chain payments for SMEs. Administered by the Small Business Commissioner, it rewards signatories (Bronze, Silver, Gold) for timely supplier payments (e.g., 95% within 30 days for Gold), but explicitly targets business practices, not consumer contracts. GOV.UK and the Code’s criteria emphasize collaborative B2B behaviors like clear terms and dispute resolution, excluding household disputes. For electricians dealing with domestic clients, protection comes via contracts and the Late Payment Act for any B2B elements, but the Code boosts reputation for commercial work—over 3,000 firms signed up by mid-2025. 

7 – What should electricians include in their contracts to protect against late payment?

To safeguard against late payments, electricians’ contracts should include clear payment terms, interest clauses, and dispute resolution, tailored to UK standards like BS 7671. Essential elements: detailed scope of work with milestones for staged payments (e.g., 30% deposit, 40% mid-project, 30% on completion) to secure cash flow; payment due dates (e.g., 30 days net) and methods (bank transfer preferred); late payment penalties under the 1998 Act (8% + base rate interest, £40-£100 compensation); non-liability clauses for external issues (e.g., power cuts); and cancellation policies with fees. Construction Companion’s template adds polite disclaimers for unforeseen conditions. GOV.UK advises e-signatures for enforceability, while Sprintlaw recommends upfront deposits to deter no-shows—ensuring legal backing in small claims court. 

8 – How do unpaid invoices affect an electrician’s ability to take on new work?

Unpaid invoices severely hamper electricians’ ability to take on new work by disrupting cash flow, limiting resources, and eroding business stability in the UK’s competitive trades market. IronmongeryDirect’s 2024 data shows electricians lose £815+ yearly from withholdings (2.5 incidents average), with 31% unable to pay staff or themselves, forcing project pauses. Direct Line’s research reveals £6,984 average chases, diverting time from bids—78% pursue claims, but unresolved debts (57% unsuccessful) tie up funds for tools/vans, per Capital on Tap. FSB estimates 50,000 closures yearly from late payments, impacting credit for loans or supplies, while stress reduces productivity (21% report mental health effects). For electricians, this means turning down jobs due to van servicing delays or hiring gaps, stalling growth amid 2025’s green energy boom. 

9 – Where can tradespeople get legal advice about unpaid invoices?

UK tradespeople, including electricians, can access free or low-cost legal advice for unpaid invoices via government-backed services and specialist helplines. The Small Business Commissioner’s office offers guidance on the Late Payment Act, including interest claims, with an online calculator and complaints portal. Citizens Advice provides free initial consultations on debt recovery, while the Energy Ombudsman (for supplier disputes) handles escalations post-8-week supplier response. Direct Line’s Legal Essentials (via business insurance) gives 24/7 ARAG solicitor access for templates and advice. For formal action, GOV.UK’s small claims court guide suits debts under £10,000; Harper James or Ashtons Legal offer fixed-fee solicitor support. FSB members get discounted legal helplines—start with a Letter Before Action to avoid court. 

10 – What steps can electricians take to reduce disputes over payments?

Electricians can minimize payment disputes through proactive strategies like clear contracts, timely invoicing, and client vetting, fostering trust while protecting cash flow in 2025’s volatile economy. First, detail scopes, milestones, and terms (30-day net, interest clauses) in signed quotes to align expectations. Invoice immediately post-job with breakdowns, using software like Tradify for auto-reminders and e-payments. Vet clients via credit checks (Experian) and require deposits (20-30%) for larger works. Communicate openly—discuss concerns early and offer phased payments. For issues, send polite chasers before LBAs, per GOV.UK. IronmongeryDirect advises staged sign-offs to prevent quality disputes; Checkatrade recommends professional templates. These steps cut incidents by 50%, per FSB, allowing focus on growth.