Late payment interest
This page presents Treasury Instructions related to the payment of invoices and the impact to reporting of late payment interest
How are Injury Management Claim Invoices treated?
Invoices relating to Injury Management Claims are managed and submitted via SIMS (Self Insurance Management System).
These invoices are entered with an invoice date and a date received at the agency. Any applicable late payment of interest will accrue from the date received at the agency.
Injury Management Units should ensure the following operational process is followed when entering invoices on SIMS:
For all invoices received prior to the acceptance of liability, then the SIMS 'Date Received' date needs to reflect the date of the acceptance of liability (i.e. date of claim acceptance, date of the SAET sealed orders were received, etc);
For all invoices received after the acceptance of liability, then the SIMS 'Date Received' date needs to reflect the date the invoice was received by the relevant Injury Management Unit.Back to top
Can I use a Purchase Card to Pay a Late Invoice?
Purchase cards should not be used to pay overdue invoices.
Purchase cards should only be used to make payments for goods and services immediately at the point they are received (or shortly thereafter). Therefore, it is assumed that there will not be any instances where late payment interest needs to be calculated for an invoice paid via purchase card. As a result no changes to existing purchase card payment processes or systems have been contemplated at this time.
How are Pre-Payments Treated?
Treasurer's Instruction 11 allows for certain circumstances where payment in advance is allowed for goods and services not yet rendered. Where an invoice relating to a prepayment is received and processed by the public authority for payment, the Invoice Received at Agency date will be used to calculate any late payment interest due (i.e. the same process as for an invoice received after the applicable goods and services are delivered).
Generally payments in advance for goods that have not been received or for services not yet rendered may only be made where it is required in the ordinary course of business to make such payments; i.e. insurance, leases where the agreement states that payments must be made monthly in advance, motor vehicle registrations, subscriptions, telephone rental, water rates and similar would be considered to be in the ordinary course of business. Please refer to Treasurer's Instruction 11 for more information.Back to top
Treasury Instruction 8 and Late Payment Interest
Treasurer's Instruction 8 has been amended to enable interest to be paid without requirement for approval by a public authority financial delegate.Back to top
Treasury Instruction 11 Performance Reporting and Late Payments
New accounts payment performance reporting requirements have been in place since 1 June 2018, following amendment of Treasurer's Instruction 11. In summary, Sections 11.14A of TI11 requires public authorities to submit reports to DTF and their applicable Minister (within 21 days of the end of each month) detailing:
Account payment performance and late payment interest information must be lodged through the Budget Monitoring System (BMS). The drop-down box in BMS will enable you to select the month you are entering data for.
Agencies that fail to lodge their report by the due date will be in breach of TI 11.
Treasury Instruction 12 and Late Payments
Late Payment of Government Debts (Interest) Act 2013, as amended effective 1 November 2018 to include the automatic payment of interest on overdue invoices.Back to top