An unpaid invoice from a foreign client is stressful because the usual levers are harder to use: different laws, different languages and no easy way to visit the client’s office. The good news is that most late payments are resolved with a clear sequence of reminders, and there are formal options when they are not.
The short answer: check the invoice and the contract, send a polite reminder, follow up with a firm reminder and a formal notice that includes interest and a deadline, then decide between negotiation, a collection agency or a legal claim. Within the EU, simplified cross-border procedures exist for money claims. Outside the EU, the cost of a claim usually pushes freelancers to negotiate or use a collection service.
Collection rules depend on the contract, the governing law and the countries involved. This guide is general information, not legal advice. Before you start legal action, consult a lawyer who handles cross-border claims.
Key takeaways: unpaid invoice
- Act on an unpaid invoice the day after the due date: early contact solves most cases.
- Escalate in steps: friendly reminder, firm reminder, formal notice, then collection or legal action.
- Your contract decides which law and courts apply, and whether late-payment interest can be charged.
- Inside the EU, there are simplified procedures for cross-border money claims, which are useful for larger amounts.
- Prevention is cheaper than collection: deposits, clear terms and credit checks reduce the risk.
In this guide
- Key takeaways: unpaid invoice
- Step 1: check why the invoice is unpaid
- Step 2: send a friendly reminder for the unpaid invoice
- Step 3: send a firm reminder
- Step 4: send a formal notice for an unpaid invoice
- Step 5: choose how to collect the unpaid invoice
- EU options for an unpaid invoice from another EU country
- Prevent the next unpaid invoice
- Tax treatment of a debt you cannot collect
- Common collection mistakes to avoid
- Frequently asked questions about unpaid invoice
- Final thoughts on unpaid invoice
- Sources and further reading
- Related guides
Step 1: check why the invoice is unpaid
Before you send a demand, make sure the problem is not on your side. An unpaid invoice may be caused by something simple.
- Was the invoice sent to the right person and email address?
- Did it include the purchase order number, the correct legal name and the VAT or tax number?
- Does the amount match the contract?
- Is a form, such as a W-8BEN for a US client, still missing? See the W-8BEN form guide.
- Were the bank details correct, and is the payment stuck in a transfer? Read SEPA vs SWIFT for typical delays.
Step 2: send a friendly reminder for the unpaid invoice
On the day after the due date, send a short, polite email to the accounts payable contact and your project contact. Attach the invoice and ask for a payment date.
| Element | Example |
|---|---|
| Subject | Reminder: Invoice 2026-014, due 19 November |
| Message | «Hi Anna, I noticed that invoice 2026-014 for EUR 2,400 was due on 19 November. Could you please confirm the payment date? I have attached the invoice again. Thank you!» |
Step 3: send a firm reminder
After a week or so without a reply, send a firmer message. Quote the invoice, the due date, the amount and the contract terms. Say that you expect payment by a specific date, and mention that late-payment interest may apply. Call the client if you have a phone number, because a call often gets an answer that emails do not.
Step 4: send a formal notice for an unpaid invoice
If there is still no payment, send a formal notice by email and by a method that creates proof of delivery, such as registered mail or a service with delivery confirmation. It should contain:
- The invoice number, date, amount and due date.
- A reference to the contract and the payment terms.
- The late-payment interest and any fixed compensation, if the contract or the applicable law allows it.
- A final deadline, for example 10 days.
- A statement that you will start collection or legal action if the invoice remains unpaid.
Late-payment rules vary. As an example, Spanish law allows interest and a fixed compensation for late commercial payments between businesses, and EU rules on late payment give similar protection. Whether they apply to a foreign client depends on the contract and the governing law. Read late payment clauses for international freelance contracts to prepare your contracts for next time.
Step 5: choose how to collect the unpaid invoice
| Option | When it fits | Cost and speed |
|---|---|---|
| Negotiate a payment plan | The client is willing but short of cash | Low cost; you may accept partial or later payment |
| Collection agency | The client ignores you and the amount is moderate | Usually a percentage of the amount recovered |
| Lawyer’s letter | You want pressure without going to court | Moderate cost; often effective |
| Cross-border claim in the EU | Larger amounts, client in another EU country | Court fees and time; simplified procedures exist |
| Local legal action | Client outside the EU, large amount | High cost; needs a local lawyer |
EU options for an unpaid invoice from another EU country
Within the EU, two procedures are designed for cross-border money claims. The European Order for Payment procedure is a simplified, mostly written procedure for uncontested claims. The European Small Claims Procedure covers lower-value claims, with a set ceiling that you should check at the European e-Justice Portal. Both allow a judgment that can be enforced in another EU country. They can be used without a lawyer in many cases, but legal advice is useful for larger claims.
For clients outside the EU, there is no equivalent. Look at the contract’s governing-law and dispute clauses and weigh the cost of a local claim against the amount owed.
Prevent the next unpaid invoice
- Ask for a deposit, typically 25–50%, for new clients and large jobs.
- Use clear terms: short due dates and a written late-payment clause.
- Check the client: search company registers and read reviews before you start.
- Split large projects into milestones with separate invoices.
- Stop work when a milestone is overdue, if the contract allows it.
- Invoice on time and use a professional layout. See our freelance invoice template in English.
Tax treatment of a debt you cannot collect
An unpaid invoice you issued is normally recorded as income when you issue it under the usual rules for professionals. If a debt becomes uncollectable, there may be ways to recover VAT or correct the accounting, but they have strict conditions and deadlines. Ask your gestor before you cancel anything. If you need to cancel or correct the invoice, read how to issue a corrective invoice for a foreign client.
Common collection mistakes to avoid
- Waiting weeks before you send the first reminder.
- Sending angry emails that damage the relationship and your position.
- Not keeping proof of delivery for the invoice and the reminders.
- Delivering the final files before the invoice is paid.
- Working without a written contract or without payment terms.
- Giving up too soon on a debt that a formal notice could solve.
Frequently asked questions about unpaid invoice
What should I do first when an invoice is unpaid?
Check that the invoice and the payment details are correct, then send a polite reminder the day after the due date, asking for a payment date.
Can I charge interest on a late foreign invoice?
It depends on your contract and the governing law. Spanish and EU rules provide for late-payment interest between businesses, but you should state your terms in the contract.
Is there an EU procedure to claim an unpaid invoice?
Yes. The European Order for Payment and the European Small Claims Procedure are simplified procedures for cross-border claims in the EU.
Should I use a collection agency?
It can be effective for moderate amounts when the client ignores you. Compare fees, which are often a percentage of the amount recovered.
Should I stop work if an invoice is unpaid?
If your contract allows it, pausing delivery is a strong lever. Check the contract and give written notice first.
Can I recover VAT on an unpaid invoice?
There may be a procedure for uncollectable debts, but it has strict conditions. Ask your gestor before acting.
Final thoughts on unpaid invoice
An unpaid invoice from a foreign client is usually solved by speed, clarity and documentation. Check the details, send a friendly reminder, escalate to a formal notice and choose the collection route that matches the amount and the country. Then prevent the next unpaid invoice with deposits, clear contracts and short payment terms.
Sources and further reading
- European e-Justice Portal: cross-border claims
- Directive 2011/7/EU on combating late payment (EUR-Lex)
- Boletín Oficial del Estado (BOE): Ley 3/2004 on late payment
- Agencia Tributaria (Spanish tax agency)
Related guides
- Late Payment Clause for International Freelance Contracts (With Examples)
- Corrective Invoice for a Foreign Client: Credit Note Guide for Freelancers
- How to Invoice a Foreign Company as a Freelancer in Spain
- Get Paid Internationally as a Freelancer: Methods and Fees Compared
Disclaimer: This article is for general information only and is not tax, legal or financial advice. Rules, fees and thresholds change often and differ by country; always confirm current details with the tax authority and a qualified adviser. Some links may be affiliate links, which means we may earn a commission at no extra cost to you.