Free chasing tool
Late Payment Interest Calculator
Client paying late? Work out the statutory interest and compensation you're legally entitled to charge on an overdue business invoice.
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Days late
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Interest + compensation
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Total to claim
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Interest at base rate + 8%, plus the fixed compensation fee. For B2B debts. Guidance only, not legal advice.
What you can charge for late payment
Under the Late Payment of Commercial Debts (Interest) Act, if another business pays you late you can charge:
- Statutory interest — 8% plus the Bank of England base rate, calculated daily on the overdue amount.
- A fixed compensation fee per invoice, on top of the interest:
| Amount owed | Compensation |
|---|---|
| Up to £999.99 | £40 |
| £1,000 to £9,999.99 | £70 |
| £10,000 or more | £100 |
You can charge interest from the day after payment was due. If no payment date was agreed, the default is 30 days after the client receives the invoice or the work, whichever is later. This applies to business-to-business invoices, not private consumers.
Late payment FAQs
How much interest can I charge? +
8% plus the Bank of England base rate, worked out daily on the overdue amount from the day after it was due.
What's the compensation fee? +
£40 under £1,000, £70 for £1,000–£9,999.99, £100 for £10,000+ — per invoice, on top of interest.
When can I start charging? +
From the day after the agreed payment date, or 30 days after delivery if no date was agreed.
Does it apply to consumers? +
No — statutory interest applies to business-to-business debts only.
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