Free tool
Debtor days calculator (UK)
Work out how long customers really take to pay you. Enter your trade debtors and credit sales to get your debtor days (days sales outstanding), the cash locked up beyond your agreed terms, and what funding that debt is costing you each year. No sign up needed.
| If you cut debtor days by | Cash freed up | Funding cost saved / yr |
|---|---|---|
| 5 days | – | – |
| 10 days | – | – |
| 15 days | – | – |
Enter your figures to see the working.
Quick answer
Debtor days (days sales outstanding) = trade debtors ÷ credit sales × days in the period. For example, £85,000 owed against £600,000 of annual credit sales is 51.7 debtor days. If your terms are 30 days, customers are taking nearly three weeks longer than agreed, and that gap is an interest-free loan from your business to theirs.
How the maths works
- Debtor days: trade debtors ÷ credit sales × days in period. It answers one question: on average, how many days after you invoice do you actually get paid?
- Cash locked beyond terms: debtors − (credit sales × terms ÷ days). This is the chunk of your receivables that only exists because customers pay late.
- Funding cost: debtors × your annual funding rate. If you run an overdraft or facility to cover the gap, that is real money the late payers are costing you.
What are debtor days?
Debtor days is the average number of days it takes your customers to pay you, also called days sales outstanding (DSO) or collection period. Every day of debtor days is a day you have paid for stock, staff and delivery but not been paid yourself. Recent UK surveys report that most businesses now wait longer than a year ago, and many SMEs have been forced to shorten payment terms to protect cash flow.
What is a good number of debtor days?
Start with your agreed terms, not a league table. If you invoice on 30-day terms, a debtor days figure near 30 means the system works. 45 or more means customers are quietly borrowing from you. Anything over 60 days is a red flag: for every £100,000 of annual sales that is roughly £16,500 of cash permanently stuck outside the business.
Where do I get the numbers?
Trade debtors is the “debtors” or “accounts receivable” line on your balance sheet, or the total of your aged debtors report in Xero, QuickBooks or Sage. Credit sales is your revenue for the same period, ideally invoiced sales only (cash sales are paid instantly and drag the number down). Use the same length of period for both: a 90-day quarter of sales against the debtors figure at the end of that quarter.
Can I charge for late payment?
Yes. Under the Late Payment of Commercial Debts (Interest) Act 1998, business-to-business invoices that go past terms carry statutory interest at Bank of England base rate plus 8%, plus fixed compensation of £40 to £100 per invoice. Use the late payment interest calculator to cost up a specific debt, and the invoice chaser to draft the chase.
Related tools
Digital Adaption helps UK businesses build reporting they can trust: aged debtor dashboards, automated chase workflows and numbers that reconcile. Get in touch. Need this calculator wired to your live sales ledger so it updates itself? We build custom reporting and internal tools. Contact us for a tailored quote.