Whether a debt recovery agency is worth its fee depends on what you would keep after the commission, compared with the time and any filing cost of handling the invoice yourself. These examples are illustrative calculations, not a quote or a claim about typical agency rates. No route guarantees recovery.
What an agency fee takes from a recovered invoice
Assume, only for comparison, an agency charges 20% of money it successfully recovers. If the whole invoice is recovered, the agency fee is the invoice amount multiplied by 20%, and your net is the recovered amount minus that fee. A commission-based arrangement in this example costs nothing if nothing is recovered; actual contracts can differ, so check the terms, GST and extra charges before signing.
The DIY cost you can budget before a claim
For this illustration, value your time at $60 an hour and allow 1.5 hours for a self-drafted letter of demand, organising records and follow-up. That is $90 of owner time. The letter is assumed to cost $0 to prepare and send electronically. Owner time is not a cash bill, but it still has an opportunity cost.
A Disputes Tribunal application fee is an upfront cost only if the debt is genuinely disputed and you choose to make a claim. The Tribunal cannot handle a debt the other person agrees they owe but has not paid (eligibility rules). Filing fees are non-refundable, although a Referee may order repayment if your claim succeeds in whole or part (official fee schedule).
Compare the numbers on three invoice sizes
Assume full recovery under either route so the costs are easy to compare. For the DIY column, assume the debt is genuinely disputed, so the relevant Tribunal filing fee is included. The official fee is $62 for a claim under $2,000, $124 for $2,000 to under $5,000, and $248 for $5,000 to $30,000 (Disputes Tribunal fees).
| Invoice | Agency fee at illustrative 20% | Agency net after fee | DIY time + disputed-claim fee | DIY net after those costs |
|---|---|---|---|---|
| $800 | $160 | $640 | $90 + $62 = $152 | $648 |
| $4,000 | $800 | $3,200 | $90 + $124 = $214 | $3,786 |
| $15,000 | $3,000 | $12,000 | $90 + $248 = $338 | $14,662 |
In these assumptions, DIY leaves $8, $586 and $2,662 more respectively if each full invoice is recovered. If the debt is not genuinely disputed, do not add a Tribunal fee or file there: the DIY estimate is just the assumed $90 of owner time. If you spend more time, need paid advice, or use a different agency fee, recalculate with your own figures.
Check whether the Tribunal fee applies
A filing fee is not a routine step for every overdue invoice. Use it in your comparison only where there is a real disagreement the Tribunal can decide. For an undisputed debt, compare an agency's actual written terms with the time you would spend on your own follow-up and any other lawful recovery option. Either approach can take time and may recover less than the invoice, so the table is not a promise of payment.
Frequently asked questions
Is the 20% agency commission a market rate?
No. It is an illustrative assumption chosen to show the arithmetic, not a researched market average or a rate attributed to any real agency. Replace it with a written quote and include any GST or additional charges.
Should I include a Tribunal fee for an unpaid invoice?
Only if the debt is genuinely disputed and you decide to file a claim. The Tribunal says it cannot deal with a debt the other person agrees they owe but has not paid (who the Tribunal can help).
Does either option guarantee I will be paid?
No. These figures compare costs assuming full recovery. Before choosing, consider the evidence, the debtor's position, your time and the written fee terms.
Sources for the cost calculation
Illustrations last checked 24 September 2026.