Is Your Construction Invoice Running Out Of Time? Debt Time Limits Explained
Construction projects run long, final accounts get disputed, and retentions sit untouched for a year or more after a job finishes. It's easy for an unpaid invoice to drift quietly from "being dealt with" to "forgotten about", and while that happens, a clock is running.
In short: for most unpaid construction invoices, the general time limit to pursue the debt is six years in England, Wales and Northern Ireland, and five years in Scotland. The clock generally starts when the sum falls due for payment. Once the deadline passes, the position changes significantly, so the earlier an overdue invoice or retention is acted on, the better.
The Time Limits At A Glance
England and Wales work under the Limitation Act 1980. For most simple contract debts, including unpaid invoices, a claim generally needs to be brought within six years.
Northern Ireland reaches a similar six-year position through the Limitation (Northern Ireland) Order 1989.
Scotland applies a shorter period. Under the Prescription and Limitation (Scotland) Act 1973, most trade debts and invoices generally prescribe after five years.
For a business with projects across the UK, that one-year difference is easy to miss, and it can matter on a long job where the last payment was due years ago.
Why This Matters More In Construction
Construction has features that make time limits easier to lose track of than in most sectors:
Long projects and staged payments. Applications, valuations and certificates can run over many months, so it isn't always obvious which date a debt actually fell due.
Final accounts that drag on. Disputes over the final account can leave a balance unresolved for a long time while everyone assumes it will be sorted out eventually.
Retentions. Retention money is typically held back until the end of a defects period, often 12 months after completion. Because it's released so long after the work, it's the kind of sum that can get forgotten, and the clock on it generally runs from when it falls due for release.
Scotland Is Not The Same As England
It's a common misconception that the rules are identical across the UK. There's also a difference in what happens when time runs out. In England and Wales, an expired debt generally still exists but can no longer be enforced through the courts, and the debtor has to raise the time limit as a defence. In Scotland, once the period has run, the obligation is extinguished altogether.
One more Scottish point: simply issuing court proceedings isn't generally enough to stop the clock. They need to be served on the debtor.
What Starts And Restarts The Clock
The clock generally begins on the date the debt falls due, not the date the invoice was raised or the work was completed. It can also be reset: in general, a part-payment or a written acknowledgement of the debt from the debtor can restart the period.
Old Invoices And Retentions Aren't Necessarily Lost Causes
A lot of contractors and subcontractors write off older balances because they assume the trail has gone cold. In practice, a debt that has been outstanding for a year or two is often still well within the time limit, and on commercial debts interest can continue to build under late payment legislation while it sits unpaid.
We recently helped a construction professional recover an invoice that had been overdue for over three years, along with the interest that had built up. Because it was pursued before the deadline became an issue, there was still room to act.
What To Do If You're Carrying Old Balances
Go through your ledger for anything outstanding for more than a year, and note the date each sum fell due, including retentions, rather than just the date of the invoice. If anything is approaching the five-year mark in Scotland or the six-year mark elsewhere, treat it as urgent. And where a main contractor or client has gone quiet, don't assume time hasn't already started to run out.
If you have overdue invoices or retentions sitting on your books, specialist construction debt recovery can help you recover what you're owed while there's still time to act.
This article provides general information only and isn't legal advice.
FAQs
How long do you have to chase an unpaid construction invoice in the UK?
Generally six years in England, Wales and Northern Ireland, and five years in Scotland, usually measured from the date the sum fell due.
Does the time limit apply to retentions?
Generally, yes. The clock on a retention usually runs from when it falls due for release, which is often after the defects period has ended.
Does an unpaid invoice disappear after the time limit? It depends on where you are. In England and Wales, the debt generally still exists but can't be enforced through the courts. In Scotland, the obligation is extinguished once the period has run.
What restarts the time limit on an old invoice?
Generally, a part-payment or a written acknowledgement of the debt from the debtor can restart the clock.
Should I chase an invoice or retention that's a few years old? Often, yes. Many older sums are still within the time limit, and the sooner they're pursued, the more options you have.
