Chasing overdue invoices is one of those topics nobody wants to deal with, until the day one invoice passes its deadline, another follows suit, and before you know it, your cash flow is feeling the pinch. The worst part is that, in most cases, the problem doesn't stem from a major conflict. It arises from small silences, vague promises, and deadlines that keep getting pushed back.
The good news is that recovering these values doesn't have to be a tug-of-war. When there's a method, proof, and the right communication, many payments are made without dispute. And when they aren't, it's possible to proceed with appropriate legal instruments, without losing time or room for manoeuvre.
This article shows how to collect overdue invoices in Portugal, from the first contact to legal action, including what to say, when to say it, and what should never be missing from your documentation.
Why do overdue invoice payments fail so often?
In simple terms, it usually fails for three reasons:
The creditor tries to be “understanding” for too long and misses the ideal moment to act.
There isn't an internal process, and each case is treated as if it were the first.
There is a lack of simple proof, such as order confirmation, proof of delivery, or an email accepting the terms and conditions.
Before charging: what needs to be done?
If you want the collection of overdue invoices to be quick, this is the point where you gain or lose time. This work starts long before the delay. It begins the moment the sale is made and the service is delivered.
If you want to increase the recovery rate, ensure there is a minimum kit for each customer. The simpler it is to prove the debt, the easier it is to collect.
Proposal, quote or order accepted in writing.
Clear payment terms (deadline, IBAN, penalties, interest where applicable).
Invoice issued correctly.
Proof of delivery or service provision.
Communication history regarding payment.
The overdue invoice clock: when to act?
Promptness conveys seriousness and prevents lateness from becoming a habit. Time is an ally in the early days, but it turns into an enemy when allowed to drag on. A simple method is to divide lateness into phases.
Days 1 to 5 after expiry
At this stage, the approach should be quick and clean. No accusations. Sometimes it's simply a case of forgetting. Send a short email with:
Invoice number and date.
Amount due.
Method of payment.
Request for confirmation of the regularization date.
Days 6 to 15 after expiry
If there is no response, you must escalate by one step. Here an objective timeframe is requested.
At your convenience
We request regularisation by day X, to avoid additional costs and the need for formalisation.
From the 16th
When the delay reaches this stage, the approach must become more formal. This is where a written notice makes a difference, as it places the debtor on clear notice.
Step 1: The right contact for overdue invoice collection
If the approach starts well, half the job is done. It works best when the first contact is professional, brief, and with complete information. The objective is not to discuss. It is to facilitate payment.
Effective contact includes:
Creditor identification.
Invoice reference.
Value and expiration date.
IBAN and payment method.
Date confirmation request.
Avoid long messages. Avoid threats. Avoid rants. Communication is strongest when it is factual.
Step 2: Letter of formal notice, when conversation is no longer enough
The letter of interpellation is the moment when the subject ceases to be a matter of “remembrance” and becomes one of “demand” based on evidence and proof.
When a client ignores, postpones, or invents deadlines, a firm letter is necessary. The letter serves to request payment within a reasonable timeframe, set a final deadline, warn of potential consequences, and create a written record for subsequent stages.
A good letter is not aggressive. It is firm and impossible to ignore.
Creditor and debtor details.
Invoice details (number, date, amount).
Deadline and payment due date indication.
Reference to late payment interest, where applicable.
Consequences of non-payment (e.g., injunction and enforcement).
Step 3: Payment arrangement that doesn't leave the creditor hanging
In many cases, the collection of overdue invoices is resolved with a payment plan. The typical problem is that the plan is made verbally and fails at the first delay.
If you are going to accept instalment payments, formalise it in writing. A simple agreement should state:
Total amount owed.
Initial entry and respective date.
Number of instalments, amounts and dates.
Late penalty.
This clause allows for the immediate calling in of the outstanding balance in the event of default.
Step 4: When late invoice collection should go to legal action
When the collection of overdue invoices enters the judicial phase, the focus is on recovery through legal channels, not on discussing via messages.
There comes a point when persisting by email is no longer management. It is a waste. You should move on when there is:
Total absence of response.
Repeated unfounded refusals.
Broken promises galore.
Signs that the debtor is dissipating assets.
Risk of expiry.
If you're at this point, it makes sense to analyse the most suitable route. For this, you can see our guide at injunctions and executive actions.
Injunction: the most used tool in the collection of overdue invoices
The injunction is often the most direct route when documentary evidence exists and the aim is to obtain a title to proceed.
What interests the creditor is to understand the logic.
The creditor lodges the application.
The debtor is notified.
If there is no objection, a charge can be issued to proceed.
If there is an objection, the case goes to court for discussion.
The injunction often works well when the debtor avoids formal confrontation. And, often, just the first step is enough to prompt payment.
Executive action and seizure: when it is time to enforce
When an enforceable title already exists, or when the injunction transforms into that title, the case can proceed to enforcement.
At this stage, the game changes. It's no longer a question of whether they should. The aim is to pay, including through seizure of assets or income, where applicable.
Here, preparation is worth its weight in gold.
Identify the debtor correctly.
Update addresses and contacts.
Consolidate full documents.
Confirm the value, interest and expenses.
O que dizer e o que não dizer na cobrança de faturas em atraso.
Chasing overdue invoices is an exercise in firmness and control.
There are phrases that open doors:
Do you confirm the date when you will regularise?
Can we formalise a payment plan until day X?
To avoid additional costs, we request payment by day X.
And there are phrases that close doors:
If you don't pay, I'll finish you.
I will make this public.
I will call every day.
How to calculate interest and costs without complications?
An effectively executed overdue invoice collection separates numbers and emotions: principal on one side, interest and expenses on the other.
Many people delay chasing overdue invoices because they think they have to do complex calculations. In practice, the essential thing is:
Separate capital from what is accessory.
To be transparent in the calculation.
Don't make up fees.
When agreed interest exists, use the contract. When it does not, assess the application of statutory late interest and, in a commercial context, other possible compensation.
Situations where the collection of overdue invoices requires more care
Not all debts are equal. In some cases, the approach must be especially well-crafted.
Clients who claim “defects” only when the bill arrives
This happens a lot. The service was accepted, but when the charging of overdue invoices begins, a late complaint arises. The antidote is simple: proof of acceptance and a record of what was delivered.
Old debts and the risk of statute of limitations
The longer it takes, the more likely it is that collection will become more difficult. In some cases, there may be a risk of the statute of limitations expiring. The collection of overdue invoices should be dealt with early so as not to lose momentum.
Debtor showing signs of insolvency
If there are signs of insolvency, the collection of overdue invoices may need to move to a different logic, because payment may depend on internal processes.
If your company has multiple credits and wants a coordinated approach, consult Debt and credit recovery for businesses.
A stress-free internal process for chasing overdue invoices
When there is a routine, everything ceases to be a fire and becomes a normal procedure. Chasing overdue invoices should not depend on the mood of the day. It should be a process. A simple routine, which works in many companies, includes:
Due date Automatic internal alert.
Day 2: Short email re-sending invoice.
Day 7: Request for payment date.
Day 14: formal letter with deadline.
Day 21: decision to proceed with an injunction or other course of action.
When it makes sense to ask for help
In certain cases, it is worthwhile to have external intervention right from the start, to cut corners and gain strength. Many companies manage to make initial contacts internally. But there are situations where legal support gives the process greater solidity.
For example
Relevant values.
Many documents and several invoices.
Debtor who manipulates deadlines and excuses.
Risk of expiry.
Urgent and formal action required.
Conclusion
The collection of overdue invoices is not a lottery. It's a process. And, like any process, it improves when it's repeatable, documented, and applied early.
If you want to recover without losing months, start by gathering evidence, communicating firmly, and formalising when necessary. When the client doesn't respond, proceed with the correct legal instrument.
If you are looking for an objective assessment of your case and a strategy tailored to your sector, speak to our debt recovery lawyers and treat the collection of overdue invoices as a business asset, rather than a headache for tomorrow.
note: The information presented in this article is for informational purposes only and should not be construed as legal advice. Although we have made every effort to ensure the accuracy of the content, we assume no responsibility for any inaccuracies, omissions or legal changes that may occur after publication. If you are facing a specific situation or have questions about any of the matters covered, we strongly recommend consulting a lawyer or legal specialist for advice tailored to your situation.
