The statute of limitations on an invoice is one of the least understood risks in receivables management. An unpaid receivable is not lost as long as it is not statute-barred, but once the deadline has passed, all legal recourse becomes impossible. Under French commercial law, the limitation period is 5 years for B2B receivables and 2 years for consumer receivables. Understanding when the limitation period starts to run, how to interrupt it, and what remedies remain available once a receivable is statute-barred is essential to fully protect your receivables portfolio.
Definition of the statute of limitations in debt law
Simple definition
The extinctive limitation period is the legal mechanism by which the holder of a right loses the ability to go to court to enforce that right, having failed to exercise it within a certain period. Applied to commercial receivables, the statute of limitations means that once the legal deadline has passed, the creditor can no longer obtain payment of their invoice through the courts.
The statute of limitations does not eliminate the receivable itself (the debtor remains legally indebted), but it deprives the creditor of any legal means of enforcement. In practice, a statute-barred receivable is one that is irrecoverable through legal channels.
It is important to distinguish:
- The extinctive limitation period: extinction of the right to go to court (which is what we address here)
- Lapsing of proceedings: extinction of already-initiated court proceedings due to lack of procedural acts within a certain period (2 years as a general rule)
- Forfeiture: a fixed deadline beyond which a specific action is impossible (for example, a warranty period)
Legal framework
The law on limitation periods is primarily governed by:
- Article L110-4 of the Commercial Code: sets the 5-year limitation period for obligations arising from commercial activity between traders or between traders and non-traders
- Article 2224 of the Civil Code: common law deadline (5 years) and starting point (the day the holder knew or should have known the facts)
- Article L218-2 of the Consumer Code: 2-year deadline for actions by professionals against consumers
- Articles 2240 to 2246 of the Civil Code: causes for interruption of the limitation period
The limitation period by debtor type
B2B receivables: 5 years
For any commercial receivable arising between businesses (B2B), the limitation period is 5 years (Article L110-4 of the Commercial Code). This 5-year period constitutes the standard regime applicable to the vast majority of invoices issued by businesses.
Starting point: The limitation period runs from the day after the due date of the invoice, i.e. the day after the payment deadline stated on the invoice. If an invoice issued on 1 March 2021 had a due date of 31 March 2021, the limitation period began running on 1 April 2021 and expires on 31 March 2026 at midnight.
In the absence of a due date: If no due date is stated on the invoice, the period runs from the date of receipt of the invoice (or the date of delivery of goods/performance of the service, if later). This is an additional reason to always state an explicit due date on each invoice.
Consumer receivables: 2 years
If your debtor is a consumer (an individual acting in a non-professional capacity), the applicable limitation period is only 2 years (Article L218-2 of the Consumer Code). This shorter period aims to protect consumers against late claims from professionals.
This 2-year period applies to any action by a professional against a consumer, even if the transaction is commercial on the professional’s side. It therefore affects B2C businesses (retail, consumer services, etc.).
Special cases
- Commercial rent invoices: 5 years (commercial obligations regime)
- Lawyer’s fee invoices: 5 years from the end of the engagement
- Social security contributions (URSSAF): 3 years for employers
- Tax receivables: 4 years for most taxes (tax authority’s right of recovery)
How to calculate whether a receivable is statute-barred
The calculation method
To check whether a receivable is statute-barred, here is the 3-step method:
Step 1: Identify the starting point of the limitation period This is the due date of the invoice. If absent, it is the date of receipt of the invoice.
Step 2: Identify whether any interrupting acts have occurred If yes, the period resets to zero from the date of each interrupting act.
Step 3: Calculate the expiry date Add 5 years (B2B) or 2 years (B2C) to the starting point or to the most recent interrupting act.
Worked example:
- Invoice issued on 1 July 2020, due date 31 July 2020
- Starting point: 1 August 2020
- No interrupting act
- Expiry date: 31 July 2025
If you are reading this example in April 2026, the receivable has been statute-barred since August 2025.
With an interrupting act:
- Same invoice
- Formal demand sent on 15 January 2023
- New starting point: 15 January 2023
- New expiry date: 14 January 2028
The formal demand has pushed the limitation period back by almost 3 years.
How to interrupt the limitation period
Causes of interruption
Interrupting the limitation period erases the elapsed time and starts a new full period of the same duration from the date of the interrupting act (Articles 2240-2246 of the Civil Code). The main causes of interruption are:
1. Acknowledgement of debt by the debtor (Article 2240 of the Civil Code) Any act by which the debtor explicitly acknowledges their debt interrupts the limitation period. This includes:
- An instalment agreement signed by the debtor
- An email in which they acknowledge owing the amount
- A partial payment (which constitutes implicit acknowledgement)
2. Enforcement action or legal proceedings (Article 2241 of the Civil Code) Filing an application for an order for payment, a court summons, or any seizure act interrupts the limitation period. The interruption takes effect on the date of filing the claim, even if the proceedings conclude later.
3. Formal demand Contrary to a widespread belief, a simple formal demand (registered letter demanding payment) does not interrupt the limitation period in the strict sense of the Civil Code. Only a formal demand served by a bailiff (extrajudicial act) constitutes an interrupting act under Article 2241.
Important: For B2B receivables, it is therefore recommended to use an order for payment procedure or to have a formal demand served by a bailiff to validly interrupt the limitation period, before the 5-year deadline expires.
For formal demand templates, see our article on demand letter templates for outstanding payments.
What to do when a receivable is statute-barred
Accounting and tax treatment
A statute-barred receivable must be treated as an uncollectable receivable:
Provision for doubtful receivables: Before the deadline expires, it is advisable to progressively provision receivables with significant delay, based on their age (60%, 80%, 100% depending on age brackets).
Writing off as a loss: Upon actual expiry of the limitation period, the receivable may be written off as a loss (account 654: losses on uncollectable receivables). This loss is tax-deductible under certain conditions.
VAT recovery: The VAT collected on an ultimately uncollectable receivable can be recovered, subject to obtaining a certificate of uncollectability (Article 272 of the General Tax Code). This certificate certifies that all collection procedures have been exhausted. See our article on the certificate of uncollectability for the conditions.
Tools to ensure no receivable ever becomes statute-barred
Preventing statute-bar through systematic reminders
The best defence against the statute of limitations is a systematic and early reminder policy. In practice, an invoice should never reach 3 years without legal action having been initiated.
Billabex fully automates receivables monitoring and triggers alerts well before any risk of statute-bar. The platform allows you to:
- Automatically detect each unpaid invoice from the first day of delay
- Track the age of each receivable and alert before critical thresholds
- Trigger progressive reminders: amicable, formal demand, pre-litigation
- Record all communications to build a solid collection dossier in case of legal action
- Anticipate statute-of-limitations risks with alerts at 12, 24 and 48 months before expiry
With Billabex, no receivable ever becomes statute-barred by default. Discover Billabex →
To go further: see our guide on the order for payment procedure, our article on the statute of limitations for an unpaid invoice, our guide on late payment penalties, and our complete guide on DSO to measure the full impact of unpaid invoices on your cash flow.
