Changes to late reporting guidelines
In April, Government changes will come into effect on the way larger businesses report on how quickly they pay their suppliers. Affected businesses will now have to publically report twice a year on their payment practices and performance, including the average time taken to pay supplier invoices.
Frequently asked questions
Why are the changes being made?
A recent study by payment processor BACS showed that nearly half of SME's in the UK had experienced late payments with £2.6 billion being owed to them in total. It is hoped that these changes will reduce the amount owed and increase transparency for SME's who are struggling to compete against larger organisations.
When do the changes come into effect?
The changes come into effect on the 6th April 2017.
Who is affected?
All businesses that exceed any two of the following criteria will have to comply:
- £36 million turnover
- £18 million balance sheet total
- 250 employees
What do I need to report on?
Businesses in scope of the reporting requirement must prepare and publish information about their payment practices and performance in relation to qualifying contracts, for each reporting period in the financial year. The information for each reporting period must reflect the policies and practices which have applied during that period, and the business’s performance for that period.
How do I file my report?
A web service will be available from April for companies to file their reports.
What happens if I don't comply or my filing is late?
Failure to file your report is a criminal offence, punishable by a fine.
What if my financial year starts in a different month to April?
Your reporting period will begin in the same month as your financial year. For example, if your financial year begins in August, this is when your reporting period will start. It will end 6 months later in January and then start again for a further 6 months and so on.
Where can I find more information?
There is a full guide to the changes available on the Government website. We have included the link to the pages and the documents at the top of this page.