Can I refuse to be paid by cheque?

September 5, 2017 5:47 AM

You Are Not My/An Accountant (or Lawyer), but can I refuse to accept payment by cheque for my freelance business? [NB: this question refers to Australian business practice and regulation.]

For a recent job, I have been paid by cheque. All of my accounting and banking is online, and being paid by cheque is a real pain because my bank doesn't have a physical branch where I can deposit the thing - I have to mail it in or deposit at the post office. I have a solution for this time around, but can I legally state on future invoices that payment by is by cash, direct deposit, and credit/debit card only?

posted by prismatic7 to Work & Money (7 answers total)

I don't know, but have you looked into whether you can deposit checks by phone? In the US, most banks let you make deposits by taking a photo of the check.
posted by metasarah at 6:08 AM on September 5, 2017 [3 favorites]

IANA ... money guy, but here's an article where The Australian Payments Clearing Association (APCA) chief executive Chris Hamilton says "Increasingly their biggest problem will be the payees don't want to accept their cheques. So over time it's going to get harder and harder to use them", implying you do have choice in the matter. He goes on to say "the increasing trend for merchants to switch from accepting cheques to accepting electronic payments only would ultimately encourage even "rusted-on" cheque users to make the switch."
I'd suggest the fact that online merchants may not even provide a mailing address means that you are under no obligation to provide for cheque payments, and can therefore refuse to accept them. Advising clients of this in advance/on the invoice would help keep things smooth.
posted by quinndexter at 6:19 AM on September 5, 2017 [1 favorite]

I mean, you're in charge here - couldn't you state that payment must be in cash or Icelandic Kronur or live sheep or solid gold?

You should probably state that you don't accept checks up front, though, *before* you do the work, rather than on the invoice.
posted by mskyle at 6:28 AM on September 5, 2017 [9 favorites]

Echoing quinndexter. I always like to put payment method options on the bottom of my invoice.

Remember when cheques were still relatively common and shop tills had signs stating they didn't accept them?
posted by Trivia Newton John at 6:30 AM on September 5, 2017

You should probably state that you don't accept checks up front, though, *before* you do the work, rather than on the invoice.

I'll echo this sentiment — this is the sort of stipulation that should go in the contract as well, so that it's not a surprise on the invoice.
posted by Johnny Assay at 6:41 AM on September 5, 2017 [2 favorites]

Best answer: As I understand it, you are allowed to set payment terms and options for your business, including refusing to accept cheques. You're not even technically required to take cash.

RBA:

Every sale, transaction or dealing relating to money, or involving the payment of, or a liability to pay, money in Australia is to be done in Australian currency unless it is done, or the parties to the sale, transaction or dealing agree that it will be done, in the currency of another country.

However although transactions are to be in Australian currency unless otherwise agreed or specified, and Australian currency has legal tender status, Australian banknotes and coins do not necessarily have to be used in transactions and refusal to accept payment in legal tender banknotes and coins is not unlawful.

business.gov.au: Choosing Payment Methods

There are a number of different payment types you can choose from when deciding how your customers can pay for your goods or services. The payment type you accept may depend on your specific business set-up.

Customers are likewise free not to do business with you if the payment conditions are too onerous.

IANYSoA (I am not your solicitor or accountant.)
posted by zamboni at 6:45 AM on September 5, 2017 [1 favorite]

Legally, I'm sure you can say "no cheques", however depending on your client they may say "we only do cheques, tough" and then it could turn into a Big Corporation vs you thing where is much easier to accept the cheque, particularly if they are already paying on 30 day terms. (I do a lot of work with schools, and until recently cheque was the only method of payment for most of them).
posted by cholly at 2:26 PM on September 7, 2017