Demand Letter for Unpaid Invoice
Three documents and two sheets that calculate what a late-paying client actually owes, interest included, before you send a single letter.
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Amount and Interest Calculation
[Client Name] — Invoice [#]
The number the letter states is whatever this sheet computes, not a rounded guess.
| Line Item | Amount | Basis |
|---|---|---|
| Original invoice principal | — | — |
| Contract late-fee rate | — | — |
| Partial payment received | — | — |
| Total owed as of today | — | — |
Two things most demand letters get wrong
| Compounding | Interest almost never compounds by default. Recalculating on a growing balance instead of the original principal overstates the claim and is the kind of error opposing counsel checks for first |
| Venue cap | A business plaintiff is capped lower than an individual in several states' small claims courts. The total this sheet produces gets checked against that cap before you plan around a venue |
Every demand letter template online asks for the same single number: how much is owed. That number, taken at face value, is usually incomplete. It skips whatever interest the contract's own late-fee clause already entitles the business to, and it does not adjust for a partial payment already received from the same client. It never checks whether the small-claims court the founder is planning to use can actually hear a claim that size before a single letter goes out.
Corrigan Design Studio, a fictional four-person branding agency, invoiced a client $18,400 for a rebrand project, due in 30 days under the signed statement of work. The client paid $5,000 after a follow-up call, then stopped responding to two further written reminders. Under the contract's own 18 percent late-fee clause, calculated correctly as simple interest, not compounded, and adjusted for that partial payment, the real total 97 days overdue came to $14,139.63, not the flat $13,400 a simpler tool would stop at.
The venue question mattered just as much as the math. Because Corrigan operates as an LLC rather than as a sole proprietorship, California's small-claims cap for a business plaintiff is $6,250, not the $12,500 an individual filing under their own name would get. Filing there without checking first would have waived $7,889.63 of the total by accident, a choice this pack surfaces plainly before any filing gets made rather than quietly after one already has.
What's in the pack
Timeline of Contact
Every reminder, response and payment logged with its real date, the evidence a small-claims filing and a credible letter both depend on.
Amount and Interest Calculation
The contract's own late-fee rate applied as simple interest, recalculated after any partial payment, not a rounded guess at the balance.
Escalating Letter Sequence
A reminder, then a firmer notice, each one referencing the last and updating the total, so nothing has to be drafted from a blank page.
Demand Letter
The formal final notice, stating the full history and the exact total, with a specific deadline before further action.
Small Claims Preparation Note
Checks the total against the filing state's actual dollar cap for how this business is structured, before a filing plan assumes the wrong venue.
How to use it
- 1
Open in River, or download it
Install the pack so the agent builds the calculation from your documents, or take the blank Word and CSV files away and fill them in yourself.
- 2
Send the contract, invoices and message history
The statement of work or contract, every invoice tied to the balance, and whatever emails or messages already exist between you and the client.
- 3
Get the real number, not a rounded one
Amount and Interest Calculation applies the contract's own rate as simple interest and adjusts for any partial payment already received.
- 4
Send the sequence, then check the venue before filing
The escalating letters draft from that number, and Small Claims Preparation Note checks it against your state's actual dollar cap before you file anywhere.
Frequently asked questions
Is this template free?
Yes. Three documents and two sheets download as Word and CSV files with no signup and no credit card. "Edit with AI" is a separate, optional path for founders who want the agent to build the calculation from their own contract and invoices. The rest of the packs sit in the template library.
What format are the downloaded files?
Word documents (.docx) for the three letters and notes, and CSV (.csv) for the timeline and the interest calculation, zipped together. They open natively in Word, Pages, Google Docs, Excel, Numbers and Sheets, with nothing to convert.
What does 'Edit with AI' actually do?
It creates a free River account and installs this exact pack as a private workspace. The agent reads your contract and invoices, applies the actual late-fee clause as simple interest, adjusts for any partial payment, then drafts the letters from that number.
Why does the interest calculation matter so much?
Because a contract's own late-fee clause usually entitles you to more than the flat balance. Stating it correctly, as simple rather than compounded interest, is exactly the kind of specific figure that makes a demand letter and a small-claims filing both read as documented rather than estimated.
What if the contract does not mention interest at all?
The calculation falls back to the filing state's statutory legal rate for a contract claim rather than the contract rate. The rate applied varies by state, so the sheet states plainly which basis, contract clause or state default, produced the number.
Do I still need a lawyer?
Yes, and this is not legal advice, particularly once a claim is large enough to consider civil court instead of small claims. What changes is what you hand them: a documented timeline and a calculated total, rather than an invoice and a vague sense that a client has stopped paying.
How is this different from tracking my contract obligations generally?
The obligation and renewal tracker watches deadlines across every signed agreement before anything goes wrong. This starts after a specific client has already stopped paying under one contract and calculates exactly what pursuing it is worth.
Find out exactly what a late-paying client actually owes
Download the blank pack as Word and CSV files, or open it in River and have the real interest and the right venue checked first.
Edit with AI