Retainer or ongoing contract: what to do when the client stops paying

The retainer started well. Month one was paid on time, month two a week late, and now it is month four with nothing received and an invoice due again next week. You are still doing the work, the client is still replying to your emails about the work, and the unpaid total grows every thirty days. A recurring contract makes late payment unusually easy to ignore, because the relationship carries on while the debt quietly builds.

This guide covers what to do when a retainer, maintenance contract, subscription or other regular service goes unpaid. For a one-off project, see our guide to a freelancer or agency client not paying.

Why recurring debts are different

With a single invoice, the exposure is fixed. With an ongoing service, every month of continued work adds to the balance, so waiting costs you more than it would elsewhere. There are three other differences:

• The debt is spread across invoices. Each has its own date, and each may have been paid or ignored in a different way.
• The client expects the work to carry on. That gives you leverage, but only if you use it before the balance gets large.
• Your contract matters more. Notice periods, minimum terms and suspension rights are common in recurring agreements and decide what you can do next.

Step 1: Read the contract before you do anything

Find the clauses on payment terms, late payment, suspension, termination and notice. Note the date each invoice fell due and what the contract says should happen when one is missed. If there is no written contract, the quote, the emails and the pattern of past invoices still show what was agreed.

Do not stop work in a way the contract does not allow. A pause done properly protects you. A walk-out that breaches your own agreement can hand the client a counterclaim, which our guide on a debtor threatening a counterclaim explains.

Step 2: Add up what is owed

Draw up a one-page schedule: each invoice, its date, its due date, the amount and anything paid against it. Add statutory interest and fixed compensation for each invoice if you are entitled to them. Our late payment calculator does the sum. Statutory interest applies to business-to-business debts only, so if your client is a private individual it does not apply.

Check that every invoice was actually sent to the right person at the right address. A surprising number of “unpaid” retainers turn out to be invoices that went to an inbox nobody reads.

Step 3: Decide whether to carry on

You have three realistic choices, and the right one depends on how much is owed and why.

Carry on, with a deadline. Reasonable if the balance is small, the cause is known and the client has agreed a dated plan. Put the plan in writing, and see whether to accept instalments for what to include.

Move to payment in advance. Keep the service going, but invoice monthly in advance, or ask for the overdue amount to clear before the next period starts. This protects the new money while the old balance is chased.

Pause or end the service. The right call when the client has ignored several reminders, the balance is rising and the contract allows it. Give any required notice in writing and say what would restart the service.

The same questions apply to a customer who keeps placing new orders while they owe you: how big is the exposure, is the old debt disputed, and what do your terms allow.

Step 4: Chase the balance as one debt

Send a clear message that lists the invoices, the total, the date you need it by and what happens next. Keep the tone factual. If the client replies with a promise, hold them to a date, as in what to do when a customer keeps promising to pay.

If the deadline passes, send a formal letter before action for the whole balance, including interest and compensation. If the client is a limited company, check that it is still trading before you spend more time: a dissolved or insolvent debtor changes what is possible.

Step 5: Escalate when the deadline passes

A debt built up over several months, with a clear contract and a dated schedule, is the kind that is easiest to pass on. Some agencies work on a no-collection-no-fee basis, so you pay nothing unless money is recovered. Hiring a debt collector explains the handover, and what evidence an agency needs lists what to have ready. You can compare vetted UK debt recovery agencies on Collect Compare, with names hidden until you choose, or let us match you.

Make the next retainer safer

• Invoice in advance for each period, not in arrears.
• State a payment due date on every invoice and put your late payment terms in the contract.
• Agree what happens after the first missed payment, such as a pause after a set number of days.
• Review the account monthly, not at renewal, so a late client is noticed in week one rather than month four.

The short version

• A recurring service lets a debt grow quietly, so act at the first missed payment.
• Read the contract first, then draw up a schedule of every unpaid invoice with interest.
• Choose between carrying on with a deadline, payment in advance, or pausing with proper notice.
• Chase the balance as one debt, then send a letter before action.
• If the deadline passes, escalate with a clear paper trail.

This is general information, not legal advice. Your rights depend on your contract and the facts, so take advice on your specific case.