Overdue invoice emails: what to say, and when to stop emailing
Send three short emails: a friendly nudge on the due date, a firm reminder about a week later, and a final notice with a pay-by date. Xero can send them for you as invoice reminders, and when they get no reply, the next step is a phone call, not a fourth email.
How to get this live in your business
Free. The Debtor Chasing Build Standard: the objects, the checks in order, and the pass test.
The invoice went out three weeks ago. You know it is overdue because you looked at the bank on Sunday night. Writing the email means finding the invoice, working out how to say it without sounding rude to a customer you want back, and then doing it again next week. So it waits, and the longer it waits the more awkward it gets.
In short
The problem
An overdue invoice needs someone to ask for the money, and asking is awkward, so it waits for a quiet moment that does not come.
Why it persists
The words are the hard part. With the wording written once, and Xero sending it on a schedule, nobody has to find the time.
What we would automate
The three emails, sent by Xero on a schedule, and the phone call that follows when they get no reply.
What stays with a person
Agreeing a payment plan, sorting out a dispute about the work, and deciding whether to take it further.
Take the spec to Claude, ChatGPT or Copilot. The sentence to paste is one click away.
Want the whole thing by email?
This paper, plus the rest of the library. One click to stop them.
The short answer: three emails, then a call
Most late payers are not refusing. They forgot, or the invoice is stuck behind a question nobody asked. Each email does one job and gets a little firmer. Keep them short, put the amount and the pay link in every one, and stop emailing once two have gone unanswered.
| Step | When | What it says |
|---|---|---|
| A friendly nudge | A few days before the due date, or on the day | The invoice number, the amount, the due date and the pay link. Nothing else. |
| A firm reminder | About a week after the due date | It is now overdue, here is the amount, please pay or tell me what is holding it up. |
| A final notice | Two to three weeks after the due date | A date to pay by, and what you will do next if it is not paid. Only say what you will actually do. |
| Pick up the phone | When the emails get no reply | An email cannot find out why it is not paid. A call can. |
If your invoices go out a week or two after the job, fix that first: the customer’s terms only start when the invoice lands. The Invoice Out standard covers getting the invoice out the day the job is done.
1. The three emails, ready to copy
Change the bits in square brackets. Keep the tone plain: no “as per my last email”, no apologising for asking. You did the work and the invoice is due.
When each one goes
Due date
Friendly nudge
About a week
Firm reminder
Two to three weeks
Final notice with a pay-by date
No reply
Ring them
Due date
Friendly nudge
About a week
Firm reminder
Two to three weeks
Final notice with a pay-by date
No reply
Ring them
Email 1: the friendly nudge
Send a few days before the due date, or on the day.
Subject: Invoice [number] due [date]
Hi [first name], Just a heads-up that invoice [number] for $[amount] is due on [date]. You can pay it here: [pay link] If it has already gone through, thanks, and please ignore this. Cheers, [your name] [business name] | [phone]
Email 2: the firm reminder
Send about a week after the due date.
Subject: Overdue: invoice [number], $[amount]
Hi [first name], Invoice [number] for $[amount] was due on [date] and is now overdue. I have attached it again. Could you please pay it this week, using the link below or by bank transfer to [BSB / account]? [pay link] If something is holding it up (a query on the work, a missing order number, waiting on an approval), reply and tell me and I will sort it out. Thanks, [your name] [business name] | [phone]
Email 3: the final notice
Send two to three weeks after the due date.
Subject: Final notice: invoice [number], $[amount] overdue
Hi [first name], I have emailed twice about invoice [number] for $[amount], due on [date], and have not heard back. Please pay the full amount by [date seven days from today]: [pay link] If it is not paid by then, I will [stop further work on the account / send a formal letter of demand / refer it for collection]. If you cannot pay it all at once, call me on [phone] before that date and we can agree a plan. Regards, [your name] [business name] | ABN [ABN]
Two rules for the final notice. Only name a next step you will actually take, because a threat you do not follow through teaches the customer to wait. And only mention interest or fees if your terms already say so (section 4).
2. Let Xero send them for you
Xero has invoice reminders built in. They can go out before an invoice is due or after it is overdue, and when you first turn them on Xero sets up three default reminders that you can edit or delete. Put your own wording in place of the defaults:
- 1Turn on invoice reminders in Xero. Xero Central's article "Turn invoice reminders on or off" has the current menu path.
- 2Edit the first reminder to go before or on the due date, and paste in email 1.
- 3Edit the second to go about a week overdue, with email 2, and the third to go two to three weeks overdue, with email 3.
- 4Swap the square brackets for Xero's placeholders, so each email fills in the customer's name, the invoice and the due date by itself.
- 5Check every customer has an email address on their contact, and that the invoices you raise are marked as sent.
You can stop reminders for one invoice or one customer without turning them off for everyone. That is the right move when a customer has agreed a payment plan or has raised a query you are still sorting out, so they are not sent an automated reminder in the middle of a conversation.
3. Why Xero reminders are not sending
When reminders are on and a customer says they never got one, it is usually one of these. Check them in this order.
The invoice is not marked as sent
Reminders only go on invoices Xero treats as sent. Emailing the invoice from Xero marks it sent. If you print it, send it from another system, or your job software pushes it across, mark it as sent by hand.
The contact has no email, or the wrong person
Reminders go to the primary person on the contact and anyone else with "Include in emails" ticked. If the accounts person changed, update the contact.
Reminders are off for that customer or that invoice
Someone may have switched them off during a dispute and never switched them back on.
They were off when the reminder was due
If reminders were turned off during a reminder's window and back on after it passed, Xero does not go back and send the missed one.
The amount is under your minimum
Xero can skip reminders for small balances. Check whether a threshold has been set.
It has not gone yet
Xero sends reminders once a day, early in the morning in your organisation's time zone, so a change today shows up tomorrow.
The Reminders column on your invoice list shows what Xero tried to send for each invoice. If none of the above explains it, Xero Support can see the history.
4. Can you charge interest on an overdue invoice?
Only if the customer agreed to it before the work started. business.gov.au’s guidance on letters of demand says to include a late payment interest rate only if it was in the contract. If your quote, terms of trade or contract did not mention interest, you cannot add it to this invoice. Put it in your terms for the next job.
If your terms do set a rate, the sum is simple:
Interest = amount overdue × yearly rate × days overdue ÷ 365
A made-up example: a $2,200 invoice, 30 days overdue, at a rate of 10% a year in your terms, is $2,200 × 0.10 × 30 ÷ 365, which is about $18.08.
This is general information, not legal advice. Whether a rate or fee in your terms can be enforced depends on how the terms are written and agreed. If the amount matters, ask a lawyer or your state’s small business commissioner.
5. How long can you chase an unpaid invoice?
You can keep asking for as long as the customer owes you. What runs out is the time to take them to court, called the limitation period. For an ordinary unpaid invoice it is six years in most of Australia and three in the Northern Territory, usually counted from when the invoice fell due.
| State or territory | Time to start court action on a contract debt |
|---|---|
| New South Wales | 6 years |
| Victoria | 6 years |
| Queensland | 6 years |
| South Australia | 6 years |
| Western Australia | 6 years |
| Tasmania | 6 years |
| Australian Capital Territory | 6 years |
| Northern Territory | 3 years |
Source: ASIC Report 55, Collecting statute-barred debts.
A part payment, or the customer acknowledging the debt in writing, can restart the clock, but the rules differ between states and have exceptions. In practice the clock is rarely the problem. An invoice that has had no answer for months is much harder to collect than one rung up in the first few weeks, so the useful question is not how long you can wait but how soon someone calls. If you are near the limit, get legal advice rather than relying on this table.
6. When the emails stop working, ring
Emails get paid by the customers who were going to pay anyway. The ones still open after the final notice are usually sitting behind a reason: a question about the work, a missing order number, cash being tight. An email cannot find out which. A two-minute call can, and business.gov.au’s own advice puts a polite phone call before a letter of demand. Why chasing slips in the first place is covered in our paper on overdue invoice chasing.
Have it done for you
Ringing overdue invoices is so common we built the standard into a product. Get Paid rings your overdue customers against your live Xero ledger, reads out the balance, sends the pay link during the call, and records a promise to pay as a date. Disputes come to you. $199 per month, flat, no call caps.
Build it yourself
The Debtor Chasing standard is free: when to ring, what to check before dialling, what to say, and how to record the outcome. Use it with your own staff, or hand it to whoever builds your systems so the calls are joined to your Xero book.
The emails are free. The calls are the part we run.
Set up the three emails in Xero today. For the invoices still open after the final notice, Get Paid makes the call, sends the pay link while on the line, and writes the promised date back. Hear it first: you play the customer who owes.