How to Automate Invoice Reminders (and Stop Chasing Payments)

Yes, you can stop chasing invoices by hand. If you already use accounting software like Xero, QuickBooks or FreeAgent, automatic payment reminders are built in. You switch them on once, decide when they go out and what they say, and they keep nudging customers until the invoice is paid. It's one of those features that often sits there unused.

Here's how to set it up properly, what to put in the emails, and where the law stands if a business customer still won't pay.

Why automate invoice reminders?

Chasing money is awkward, so it gets put off. A polite reminder that goes out on schedule removes the awkwardness entirely. It isn't you being pushy; it's just how your system works.

It also means:

• No invoices slip through the cracks when you're busy on a job
• Every customer gets treated the same, so nobody feels singled out
• You find out sooner which invoices actually need a phone call

Step 1: Check your payment terms are clear

Automation only works if the due date is obvious. Before you switch anything on, make sure every invoice shows:

• A clear due date (an actual date, not just "30 days")
• How to pay, with your bank details or a payment link
• Your invoice number, so the customer can match it up

If you agree specific payment terms with a customer, put them in writing before you start the work.

Step 2: Turn on reminders in your accounting software

The big three all do this. Menus change from time to time, so check their help pages if something has moved.

Xero: Look under your organisation's invoice settings for "Invoice reminders". You can set reminders before or after the due date, edit the wording, and turn reminders off for individual customers. Xero only sends reminders for invoices it knows have been sent, so mark invoices as sent if you post or hand them over yourself.

QuickBooks Online: Go to Settings, then Account and settings, then the Sales tab. In the Reminders section, turn on automatic invoice reminders. You can set up to three, each a chosen number of days before or after the due date. Again, reminders only go out for invoices you've emailed from QuickBooks.

FreeAgent: When you create an invoice (or a recurring invoice profile), tick the options to send automatic reminder emails. FreeAgent can remind customers before the due date, keep chasing once it's overdue, and send a thank-you email when it's paid.

If you invoice from Word or a spreadsheet, this is a good reason to move to proper invoicing software. It's one of the quickest automation wins there is.

Step 3: Pick a sensible schedule

You don't need many reminders. A simple pattern that works for most small businesses:

1. A few days before the due date: a friendly heads-up
2. On the due date or the day after: "just a reminder this is now due"
3. About a week overdue: a firmer note
4. Two to three weeks overdue: a final reminder, then you pick up the phone

That last step matters. Automation does the routine nudging, but a long-overdue invoice usually needs a real conversation.

Step 4: Write reminders that sound like you

The default templates tend to read like they came from a bank. Rewrite them in your own words. Keep each one short and include:

• The invoice number, amount and due date
• A direct link to pay, or your bank details
• A way to get in touch if there's a problem

Something like:

Hi Sarah, just a quick reminder that invoice 1042 for £450 is due on Friday. You can pay online here: [link]. Any questions, just reply to this email. Thanks, Jack

Friendly but clear. If a customer has a genuine query about the work, you want them to tell you, not quietly ignore the invoice.

Step 5: Make paying easy

Plenty of late payments aren't deliberate, they're just faff. Most accounting tools let you add a "Pay now" button that takes card or bank payments online. There's usually a fee, so check the costs, but getting paid days earlier is often worth it.

What if a business customer still won't pay?

If your customer is another business (not a member of the public), UK late payment law gives you some backup. According to gov.uk:

• You can claim statutory interest of 8% plus the Bank of England base rate on late commercial debts, unless your contract sets a different rate
• You can also claim a fixed debt recovery sum: £40 for debts under £1,000, £70 for £1,000 to £9,999.99, and £100 for £10,000 or more
• If you add interest, you need to send a new invoice

You don't have to use these rights, and with a good long-term client you might choose not to. But it's worth mentioning in your terms, and your final automated reminder can politely say that you reserve the right to charge it. I'm not a lawyer, so for anything complicated, check the gov.uk guidance or speak to an adviser.

Want a hand automating the boring bits?

Invoice reminders are usually the first thing I suggest, but most small businesses have a few more admin jobs that could run themselves. My Automation & Workflow Review looks at how you work now and points out the easy wins. If you want to see where you stand first, try the free AI readiness quiz, and for more ideas, read 5 repetitive tasks you could hand off to automation this month.