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Department of Corporate and Information Services

30 Day Payment Policy

Background

The NT Government introduced a 30 day payment policy for works, goods and services in July 2004.

Under this policy all accounts are to be paid within 30 days of receipt of invoice, except where there is a dispute over the account.

Suppliers can seek penalty interest payments from government when the 30 day payment is not adhered to.

Contracts entered into on or after 1 July 2004 include a clause which covers payments of penalty interest by the NT Government.

Payment of penalty interest guidelines

The invoice payment period applies 30 days from the date of receipt of the invoice where:

  • the invoice is correct and not disputed
  • works, goods or services have been received.

The penalty interest rate will be set on an annual basis and paid at the 90 day bank bill rate as at 1 June each year. For 2017-18, the rate has been set at 1.62%.

Interest penalty provisions do not apply to the late payment of interest penalties.

Calculating the penalty interest payment

Interest is calculated from the 31st day to the date the late payment was made by the NT Government.

Example

An invoice is received on 15 April and payment is made on 31 May, so the interest payable is for the period 15 May to 31 May (both days inclusive) or 17 days.

Invoice Received 15 April
      30 day payment due 14 May
Payment made 31 May
      Penalty period begins 15 May
      Penalty period ends 31 May
Penalty interest due 17 days

 

How to make a penalty interest payment claim

Suppliers need to submit a tax invoice to claim the penalty interest within 90 days of the late payment being made.

The invoice is to be submitted to the government organisation that received the original invoice.

The invoice details must include:

  • date of deemed receipt by the NT Government organisation of the original invoice
  • date of payment
  • copy of the original invoice
  • period for which the supplier considers interest is due
  • amount of penalty interest sought.