The Late Payments Bill reaches Parliament

The UK’s Late Payments Bill has been introduced in the House of Lords, putting payment terms and enforcement powers back in focus. For small-business owners elsewhere, the comparison is a reminder that protections differ widely—and that a rule on paper is only useful if it can be enforced.

What happened

On 19 May 2026, the UK Late Payments Bill was introduced in the House of Lords, proposing a 60-day maximum payment term, mandatory interest on late payments and new powers for the Small Business Commissioner.

The UK bill proposes a maximum 60-day payment term, mandatory interest at 8% above the base rate, and adjudication and fine powers for the Small Business Commissioner; import and export contracts are exempt from the proposed cap.
The EU proposal for a hard 30-day cap was put forward in September 2023 and received a European Parliament position in April 2024, but was blocked in the Council.
India’s rules require payment to micro and small enterprises within 45 days where there is a written agreement, or within 15 days without one; late payment can affect the buyer’s tax deduction and trigger compound interest.

What it means for small businesses

The UK bill is a proposal, not an enacted protection as of 21 May 2026. Owners should not treat its proposed deadlines or remedies as already in force.

Payment protections vary by jurisdiction: a supplier’s location, the buyer’s location, the contract and the type of transaction can all matter.

Reseated’s Cashflow reports show recurring late-payment problems across countries and business sizes, but they are member reports—not a representative estimate of all small businesses.