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Examples :: Business Letters :: Extension of time for payment-approved

Extension of time for payment (approved)

It's sometimes necessary and appropriate to give an extension of time for payment in any business.

This is purely discretionary.

Your original terms of trade are the basic legal obligations on the person responsible for payment.

Despite the obvious fact that you have the right to demand payment on time, that's not always appropriate, and can be unreasonable or simply unrealistic.

A person showing intention to pay may also have grounds for dispute.

If you've

  1. Been advised of a change of circumstances beyond the person's control, and
  2. Have refused an extension of time when it's clearly beyond the person's capacity to pay,

Whose fault is it if payments aren't made?

Note: Under these conditions the client has done the right thing, and you should acknowledge that. A court could consider failure to respond appropriately to an offer of payment could be onerous.

Situations and problems vary a lot, but at least you've been told about the problem, and the person still intends to pay.

Realistically, extension of time and in some cases modification of payments is the only option.

The example below is a positive approach to a request for an extension of time by a good customer



Your reference
Our reference


Request for extension of time for payment of account

I refer to your letter of (date) explaining your need for an extension of time for payment on your account with us due to changed business circumstances.

I'm pleased to inform you this request has been approved on the terms of payment you suggested:

$200 per calendar month (no fixed date per month) commencing June 2010

Note: We appreciate your prompt notification of your need to vary terms of payment, and penalties for current arrears have been waived.

Accordingly, the sum of $325.19 owing for arrears on your previous statement of account is no longer payable.

If you require any further assistance in this matter, please contact me directly on the above phone number or email.

Yours sincerely



Please note:

  • This text is intended for advisory and guideline purposes only.
  • Any business letter can become a legal document, so check your content properly before issuing.
  • Any executable or statutorily defined document should be checked for compliance with legal requirements, and you should seek legal advice regarding its contents.