Government unveils new payment reporting rules for large companies
06 Dec 2016
The government has outlined new measures that will require large companies to publish details on how quickly they pay their suppliers.
The proposals, which come into force in April 2017, will require large firms and limited liability partnerships (LLPs) to publicly report twice a year on both their payment practices and their performance, including the average time taken to pay supplier invoices.
A recently-published report by the Federation of Small Businesses (FSB) found that, on average, 30% of payments are late.
The government hopes the new measures will increase transparency and help small businesses to make ‘informed decisions’ in regards to who they do business with.
Small Business Minister, Margot James, commented: ‘By shining a light on how large businesses pay their smaller suppliers, we want to empower small businesses and drive a real change in payment culture.’
The measures form part of a package to tackle late payments, which also includes the appointment of a Small Business Commissioner. The Commissioner will support small businesses in resolving any payment disputes.
Guidance on how to comply with the requirement to report will be published by the government early next year.