Utah Statute of Limitations on Business Debt: What Creditors Owed by a Salt Lake City Company Need to Know

A creditor owed by a Utah company usually has four years to sue on an open account or an unwritten agreement, six years on a contract founded on a signed writing, four years on a sale of goods, and eight years to enforce a judgment. Those periods come from the Utah Code, and the one most trade creditors live under, the four years, runs from the last charge or the last payment on the account, not from each invoice.

That last detail is the part worth understanding, because it changes how a Salt Lake City account should be worked. Below is what the Utah statutes actually say, where the clock starts, what moves it, what happens when the customer or the contract points at another state, and what to do with a Wasatch Front account that has gone quiet. Laws vary by state and this is general information, not legal advice.

Key takeaways

• Utah gives four years to an action on a contract not founded on a writing, on an open account for goods, and on an open account for work, labor, services or materials, measured from the last charge made or the last payment received, under Utah Code 78B-2-307.
• An obligation founded upon an instrument in writing gets six years under Utah Code 78B-2-309, and a judgment can be enforced for eight years from entry or renewal under Utah Code 78B-2-311.
• A breach of a contract for the sale of goods gets four years under Utah Code 70A-2-725, and the original agreement can cut that to as little as one year. Read your own terms and your customer's before you assume you have time.
• A payment or a written acknowledgment by the debtor gives you a fresh period from that date under Utah Code 78B-2-113, and a claim that is already time barred where it arose cannot be revived by filing in Utah under Utah Code 78B-2-103.
• If you have a signed agreement that allows for collection costs or collection agency fees, those charges may be included in the amount sought during collection. If legal action becomes necessary, recoverable fees and costs are determined under applicable Utah law and are ultimately subject to the court.

How long do you have to sue on a business debt in Utah?

Direct answer

Four years on an open account or an agreement not founded on a writing, six years on an obligation founded upon an instrument in writing, four years on a contract for the sale of goods, and eight years on a judgment. The four and six year periods are in Utah Code 78B-2-307 and 78B-2-309, goods in 70A-2-725, judgments in 78B-2-311.

Start with the four year section, because that is where most trade accounts land. Utah Code 78B-2-307 says an action may be brought within four years, after the last charge is made or the last payment is received, upon a contract, obligation or liability not founded upon an instrument in writing, on an open store account for goods, wares or merchandise, or on an open account for work, labor or services rendered, or materials furnished. If you ship product, do work or supply materials on an account and the customer pays off invoices as they come, that is you.

Utah Code 78B-2-309 gives six years to an action upon any contract, obligation or liability founded upon an instrument in writing. A signed promissory note, a signed equipment lease, a signed service contract with the price in it: those are the clean examples. Subsection (2) of that section, which starts the six years from a written acknowledgment or a payment, is written for a credit agreement with a financial institution as defined in Utah Code 25-5-4, so a trade creditor should not read it as a rule for ordinary commercial accounts.

A judgment is its own category. Utah Code 78B-2-311 allows eight years from entry of a judgment of any court of the United States, or of any state or territory, or from a renewal of that judgment under Utah's Renewal of Judgment Act. In practical terms, a creditor who wins is on a much longer clock than a creditor who is still deciding whether to act, which is one more reason the deciding should not take years.

What does "from the last charge or the last payment" mean for an open account?

Direct answer

Under Utah Code 78B-2-307 the four years on an open account run from the date of the last charge made or the last payment received on that account, not from the due date of each invoice. An account that keeps trading keeps resetting. The day you stop shipping and the customer stops paying is the day the clock actually starts.

This is the Utah wrinkle I would want every credit manager on the Wasatch Front to understand, because it cuts both ways. On the one hand, a long running account where the customer is still ordering and still sending something, even late, is not aging out in the way a stack of old invoices suggests. The period is measured from the last activity on the account.

On the other hand, the moment that activity stops, every unpaid invoice on the account is on the same four year countdown, whatever its original date. Creditors sometimes reason that a 2023 invoice has a 2027 deadline and a 2024 invoice has a 2028 deadline. Under this section the question is when the last charge or payment happened. If that was March, the clock for the account runs from March.

Two habits follow from that. Keep the account history clean, so you can prove the date of the last charge and the last payment without reconstructing it from emails. And treat a customer who has gone silent as a customer whose clock has started, not as an account that is merely aging. A credit hold with no new charges is often the right commercial decision, and it also fixes the date from which Utah measures your time.

Does a sale of goods get four years or six in Utah?

Direct answer

Four, and possibly less. Utah Code 70A-2-725 requires an action for breach of a contract for sale to be commenced within four years after it accrued, and the original agreement may reduce that to not less than one year but may not extend it. The cause of action accrues at the breach, whether or not the creditor knew of it.

Utah's version of the Uniform Commercial Code applies to contracts for the sale of goods, which covers most distributors, manufacturers and suppliers reading this. Three things in the section deserve attention. The period is four years. The parties may shorten it in the original agreement, down to one year, and a customer's purchase order terms or master supply agreement can do exactly that if you signed them. And the clock starts at breach whether or not you knew about it, so a nonpayment that nobody noticed for a year still used up a year.

Compare that with Colorado, where the sale of goods section points at the general contract period and says it may not be varied by agreement, and with Washington, where a seller's own terms can cut the period to one year. Utah sits with Washington on this point: the agreement controls, so the paperwork matters more than the state. If you sell into Utah on a customer's forms, read the limitations clause before you decide how long you can wait.

Does a payment or a promise to pay restart the clock in Utah?

Direct answer

Yes. Utah Code 78B-2-113 allows an action for recovery of a debt within the applicable period measured from the date the debt arose, the date the debtor makes a written acknowledgment or a promise to pay, or the date the debtor makes a payment. A payment or a signed acknowledgment during the period gives a fresh period from that date.

That is a creditor friendly rule, and a partial payment is the simplest way to use it. A customer who sends a small check on an old account in order to keep the relationship alive has, under this section, given you a new period measured from that payment. The same goes for a written acknowledgment or a promise to pay, so a signed payment plan or an email from the controller confirming the balance and committing to a schedule is worth getting in writing for more than one reason.

What the statute does not say is as important as what it does. It does not say that a payment made after the period has already expired brings the claim back, and subsection (2) says that a right of action barred by any statute is unavailable as a cause of action or as a ground for defense. Washington's statute says in so many words that nothing revives an expired claim. Utah's is silent on that question. The safe reading for a creditor is to treat an expired account as expired, and to ask a Utah attorney before relying on a late payment to resurrect it. The better practice is to never let an account get close enough to the line for the question to matter.

What if the customer is in another state, or the contract picks another state's law?

Direct answer

Utah Code 78B-2-103 says a cause of action that arose in another jurisdiction and is time barred there may not be pursued in Utah, unless a Utah citizen has held it since it accrued. A contract's choice of law clause can also bring another state's period into play. Ask a Utah attorney before relying on either.

Two situations come up constantly on commercial accounts. First, a Salt Lake City company is owed by a customer in another state and the shipping, the contract and the breach all happened there. If that state's period has already run, Utah's borrowing statute closes the Utah courthouse to the claim as well, with the exception written into the section for a cause of action held by a Utah citizen from the start. Second, the customer is in Utah but your credit agreement says it is governed by the law of your own state. Which state's limitation period a court applies in that situation is a choice of law question, and the answer is not the same in every court or for every clause.

The practical rule is the one I give for every state: find out which period is the shortest among the states that could plausibly apply, and work the account against that one. Utah also tolls the period while a defendant is out of the state and beyond the reach of Utah's courts under Utah Code 78B-2-104, but that section is limited by the long arm statute it cites, and a company that is reachable through Utah's courts is not getting your clock paused by being physically elsewhere. Treat tolling as a question for counsel, not a plan.

Can you take a Utah business debt to small claims court?

Direct answer

Yes, within limits. Under Utah Code 78A-8-102 a small claims action is a civil action for the recovery of money where the amount claimed does not exceed $20,000 for cases filed from January 1, 2025 through December 31, 2029, exclusive of court costs and interest, and the defendant resides or the debt was incurred within the jurisdiction of the court.

Utah raised its small claims ceiling in steps: $15,000 for actions on or after May 4, 2022, $20,000 from the start of 2025, and $25,000 scheduled from January 1, 2030. Counsel is not required in small claims, which is the point of the court, and for a Utah creditor with a documented invoice and a customer who simply will not pay, it is a legitimate route for a claim that fits under the cap.

Two cautions before you file. The cap is a ceiling on the claim, not an invitation to cut a larger balance down to fit, and a creditor who does that is leaving money on the table permanently. And the jurisdiction test matters: the defendant has to reside, or the debt has to have been incurred, within the jurisdiction of the court you file in. A claim against a Lehi company for product shipped to Lehi belongs in that court, not in whichever one is nearest your office.

For most accounts in the range we handle, from $1,000 to hundreds of thousands of dollars, the right first step is still a professional collection effort before anyone files anything. A filing is public, it is adversarial, and once a claim moves toward court the interest question gets decided by the contract and by Utah Code 15-1-1, which sets a legal rate of 10% per annum for a written, verbal or implied contract that does not specify a different rate. An agency effort costs nothing unless it collects, and it keeps the courthouse in reserve.

Does a collection agency need a Utah license?

Direct answer

No. Utah repealed its collection agency registration requirement in 2023. H.B. 20, Collection Agency Amendments, passed in the 2023 General Session and took effect May 3, 2023, and the Utah Division of Corporations says it no longer requires a collection agency operating in Utah to register or to post the associated bond.

Until 2023, Utah Code Title 12, Chapter 1 required a collection agency doing business in the state to register with the Division of Corporations and post a bond. H.B. 20 repealed sections 12-1-1 through 12-1-10, which is where that requirement lived, and the one section of the title that remains has nothing to do with registration. The Division's own page on the subject now says it will no longer require a collection agency operating in Utah to apply for the registration or submit the bond, while noting that an agency may still need to register its business entity or name like any other company.

For a creditor that sounds like good news, and in one sense it is: there is no Utah registration for an agency to lapse on. In another sense it removes the only state level screen that ever existed, so the vetting is now entirely on you. That is why it is important to use a certified commercial collection agency. Sven works with C2C Resources, which is certified by the Commercial Law League of America, endorsed by the International Association of Commercial Collectors, carries a $500,000 surety bond, and holds collection licenses in the states that require them. Our where we collect page lists the states we work, Utah included.

What should a creditor do with a Salt Lake City account right now?

Direct answer

Fix the date of the last charge and the last payment, because that is where Utah measures from. Pull the signed paperwork and read any limitations clause in it. Put the account on hold so no new charges blur the record. Then place it with a commercial agency while there is time left, not when the four years are gone.

Here is the order I would work a Utah account in. First, establish the dates. The last charge, the last payment, and the date of any written acknowledgment or promise to pay from the customer. Those three dates tell you which period applies and when it started, and they are the first thing a Utah attorney will ask for if the account ever goes that far.

Second, read the documents, not the system. If the customer signed your credit application, read what it says about interest, collection costs and governing law. If you sold goods on the customer's purchase order terms, read their limitations clause, because Utah Code 70A-2-725 lets an original agreement cut the period to one year. On service charges the rule is simple: if your invoices are due on receipt, Utah's interest statute applies a legal rate to a contract that does not specify one; if you extended credit terms such as net 30, any service charge or interest has to be in the written credit agreement, and a charge that first appears on a past due statement will be disputed.

Third, decide. A Utah account with a signed agreement, a clean history of charges and payments, and a customer who has gone silent is a strong placement, and the earlier it is placed the better it collects. Our construction clients on the Wasatch Front have a second clock to watch, the lien deadline, and that is covered in the construction collections guide. The same creditor pattern in the neighboring states is in the Colorado, Nevada and Washington guides.

Book a Call with Sven

Prefer the phone? 866-341-6316. Or schedule a free consultation online. You can see how the process works on our commercial debt collection services page, and the resources page has credit application and collection letter templates for the paperwork side of this.

Frequently asked questions

Is the Utah statute of limitations different for a business debt than for a consumer debt?

The limitation periods in Utah Code Title 78B, Chapter 2 apply to contract claims generally, business or consumer. What differs is everything around them: a commercial account usually has a credit application, purchase orders and a history of charges and payments that decide which period applies and when it started. We handle commercial (B2B) claims only, so this article is written for the creditor side of a business account.

Our Salt Lake City customer signed our credit application. Does that give us six years?

Not automatically. Six years is for an obligation founded upon an instrument in writing. Whether a signed credit application plus a run of invoices puts an open account into that bucket is argued case by case, and the answer can turn on what the application actually says. Plan on four years from the last charge or last payment, and treat six as something a Utah attorney confirms for your paperwork, not something you assume.

The last invoice is five years old, but the customer made a small payment last year. Can we still collect?

Possibly. Utah measures the period from the date the debt arose, a written acknowledgment or promise to pay, or a payment by the debtor, whichever is later. A payment made while the account was still alive gives you a fresh period from that date. What the statute does not spell out is whether a payment made after the period had already run brings a dead claim back, so do not plan around that. Put the dates in order and ask a Utah attorney before you rely on a late payment.

Can we charge interest on a past due Utah invoice if our terms never mention it?

It depends on your terms. Utah sets a legal rate by statute for a written, verbal or implied contract that does not specify one, which matters most on invoices that are due on receipt. Where you extended credit terms such as net 30, any service charge or interest belongs in the written credit agreement the customer signed. A charge that appears for the first time on a past due statement is the first thing a customer disputes.

What size of claim can you help with?

We work commercial claims from $1,000 to hundreds of thousands of dollars, under 120 days past due, on contingency, so there is no fee unless we collect. Commercial (B2B) collections only. We do not collect consumer debt. That covers accounts owed by companies in Salt Lake City, Ogden, Provo, Lehi, St. George and the rest of Utah. Yes, we collect internationally. Talk to us about your specific account.

Sources: Utah Code 78B-2-307, 78B-2-309, 78B-2-311, 78B-2-113, 78B-2-103, 78B-2-104, 70A-2-725, 78A-8-102 and 15-1-1 as published by the Utah State Legislature on le.utah.gov, H.B. 20 (2023 General Session), and the Utah Division of Corporations collection agency page, all reviewed October 2026. Laws vary by state and change over time, and the facts of each account matter. This article is general information from a commercial collections professional, not legal advice, and it is not a substitute for advice from a Utah attorney. Written by Sven Nelson, The Guy That Gets You Paid.