[DebtCollector]

I hear a lot of people on this forum talking about the charge of late fees on overdue accounts.

Do not charge anyone a late fee, unless you want to ruin any goodwill you have built with that client. Apart from being illegal (unless they have signed contracted agreeing to those terms, and anyone who signs that sort of a contract with a small business needs his/her head read) it really is bad form. It's ok for the big banks and telcos to charge late fees because they don't care if they keep your business or not. You are much better of to offer discounts if they pay in a certain time frame:

10% off if payed in 7days of invoice.
5% off if payed in 14 Days of invoice.

Not precisely as above, but you get the idea. Offer incentives to get them to pay you on time or earlier.

You will soon sort out the good payer from the bad and if they are really bad you drop them faster than a hot iron and give them to a debt collector. Remember your a small business, it's all about personal service. Not how much you can screw them for. Leave that for the big boys.