Why EOFY Is the Best Time to Tackle Debt Recovery

Unpaid invoices hurt your cash flow, inflate your bad debt write-offs, and weaken your financial position going into the new year. EOFY is the perfect time to get proactive about debt recovery—and here’s why.

Clean Up Your Balance Sheet

Every unpaid invoice sitting on your books affects your year-end results. EOFY is the time to:

• Review your accounts receivable
• Follow up on overdue payments
• Write off bad debts if necessary (for tax purposes)

But WAIT……before you write anything off; consider legal action. You may still have time to recover what you’re owed.

Legal Demand Letters Get Results

Sometimes a polite reminder just doesn’t cut it. If you’ve chased an invoice and been ignored, a formal Letter of Demand from a lawyer can:

• Get attention fast
• Show you’re serious about recovering the debt
• Often lead to payment without needing court action

A well-drafted legal letter often succeeds where internal efforts fail.

Know Your Time Limits

Many debts are subject to strict legal timeframes.

EOFY is a great time to:

• Identify older debts nearing expiry
• Escalate or take action before they become unrecoverable

Court Is a Last Resort—But It’s an Option

Courts generally require you to show you’ve attempted resolution first (which makes EOFY follow-up efforts even more important). Legal avenues include:

• Issuing a statutory demand (for companies)
• Enforcing payment through winding-up proceedings
• Filing a claim in small claims or magistrates’ court

These are serious steps—but when the amount owed is significant, they can be worth it.

Improve Your Credit and Collections Process

EOFY is also the perfect time to review and improve your internal systems:

• Tighten your credit policies
• Update your terms and conditions
• Use proper documentation to make recovery easier next time

And remember: it’s always easier to recover a debt when your paperwork is in order.

Don’t Carry Unpaid Debts Into the New Year

You’ve worked hard—don’t let unpaid invoices drag your business down. Whether you need a formal letter, statutory demand, advice on next steps, or help starting proceedings, now is the time.

Let’s talk before EOFY hits.

Our legal team can help you recover what you’re owed—and set you up for a stronger financial year ahead.