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Late payment interest calculator

Statutory interest on a late commercial invoice is 8 percentage points above the reference rate that was in force when the invoice went late, not the rate today. This works that out for the UK and the EU, adds the fixed compensation you are also owed, and writes the three emails to send: a nudge, a formal reminder, and a final notice.

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The invoice

£

The full amount owed, including any tax on the invoice.

%

Agreeing your own rate takes the debt out of the statutory scheme, so the fixed compensation goes with it.

Who it goes to

Only used to fill in the emails below. Nothing is sent to us.

What to send

Escalating, in the order you send them. The first assumes an oversight, because it usually is one. Only the last mentions what happens next.

A nudge Day 1 to 14 overdue

Subject

Invoice the invoice

Hello there,

Invoice the invoice was due on 2026-06-13 and I do not think it has come through yet. It is entirely possible it is sitting with someone for approval, so this is just a nudge rather than a chase.

Could you let me know roughly when it is likely to be paid? If it would help, I am happy to resend it or send it straight to your accounts team.

Thanks,
Me
Open in email
A formal reminder Day 15 to 30 overdue

Subject

Overdue: invoice the invoice (45 days)

Hello there,

Invoice the invoice is now 45 days overdue. It was due on 2026-06-13 and remains unpaid.

The outstanding amount is £5,142.43, which includes £72.43 of interest accrued so far. Under the Late Payment of Commercial Debts (Interest) Act 1998 I am entitled to statutory interest at 11.75% a year plus fixed compensation, which is included in the figure above.

Please could you confirm a payment date this week. If there is a problem with the invoice itself, tell me what it is and I will get it corrected today.

Thanks,
Me
Open in email
Final notice Day 30 or more overdue

Subject

Final notice before further action: invoice the invoice

Hello there,

Invoice the invoice, due 2026-06-13, is now 45 days overdue and I have not had a payment date.

The amount currently outstanding is £5,142.43. Under the Late Payment of Commercial Debts (Interest) Act 1998 I am entitled to statutory interest at 11.75% a year plus fixed compensation, which is included in the figure above. Interest continues to accrue daily until the invoice is paid.

Please treat this as a final request for payment. If the invoice is not settled, or a payment date agreed with me, within 7 days of this message, I will pass it to a collections service and recover the costs of doing so where I am entitled to.

I would much rather resolve this directly. If something is stopping payment, tell me and we will sort it out.

Me
Open in email

The figures in these emails update as you change the numbers above. Reload the page to rewrite them for a different jurisdiction.

Owed to you now

£5,142.43

The invoice
£5,000.00
Interest so far
£72.43
Fixed compensation
£70.00
Days late
45
Annual rate
11.75%
Accruing per day
£1.61
Reference rate
3.75% on 2025-12-31
Show the arithmetic

Debt × annual rate ÷ 365 × days late. Simple interest, never compounded, because both statutory schemes are simple and compounding gives the other side a reason to dispute the whole claim.

UK statutory rates by six-month window
Invoice went late Reference date BoE base rate Statutory rate
1 Jul 2026 to 31 Dec 2026 30 Jun 2026 3.75% 11.75%
1 Jan 2026 to 30 Jun 2026 31 Dec 2025 3.75% 11.75%
1 Jul 2025 to 31 Dec 2025 30 Jun 2025 4.25% 12.25%
1 Jan 2025 to 30 Jun 2025 31 Dec 2024 4.75% 12.75%
1 Jul 2024 to 31 Dec 2024 30 Jun 2024 5.25% 13.25%
1 Jan 2024 to 30 Jun 2024 31 Dec 2023 5.25% 13.25%
1 Jul 2023 to 31 Dec 2023 30 Jun 2023 5.00% 13.00%

How this works

The rate is not today's base rate. That is the detail nearly every calculator online gets wrong, and it produces a figure the other side's solicitor will spot.

Under the UK's Late Payment of Commercial Debts (Interest) Act 1998, statutory interest is 8 percentage points above the Bank of England base rate in force on the reference date. The reference date is 31 December for debts that fall late between January and June, and 30 June for debts that fall late between July and December. Whatever that rate was, it applies for the whole six-month window, even if the Bank moves in the middle of it.

The EU directive works the same way, off the ECB main refinancing rate on 1 January or 1 July, and adds a €40 minimum for recovery costs. The UK adds fixed compensation of £40, £70 or £100 depending on the size of the invoice, once per invoice rather than per reminder.

Interest is simple: debt, times the annual rate, divided by 365, times the days late. It runs from the day after the due date, so an invoice due today is not late today.

Where the numbers come from

Rates come from the Bank of England's official bank rate history and the ECB's main refinancing operations rate, mapped to the reference dates set out in the Late Payment of Commercial Debts (Interest) Act 1998 and Directive 2011/7/EU. Every rate in the table above can be overridden if yours differs. This is an estimate to help you have the conversation, not legal advice, and it does not cover sector-specific prompt payment rules.

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Questions

How much interest can I charge on a late invoice?

In the UK, statutory interest on a commercial debt is 8 percentage points above the Bank of England base rate, plus fixed compensation of £40, £70 or £100 depending on the size of the invoice. In the EU it is at least 8 points above the ECB reference rate plus €40. In the United States there is no general statutory rate: what you can charge is what your contract says, capped by your state's usury limit.

Which base rate applies, today's or the one when the invoice went late?

The one in force on the reference date, which is why most calculators get this wrong. For a UK debt falling late between January and June, it is the base rate on the previous 31 December. For one falling late between July and December, it is the rate on 30 June. That rate is then fixed for the whole six-month window even if the Bank moves in the middle of it.

Is statutory interest compounded?

No. It is simple interest: the debt times the annual rate, divided by 365, times the number of days late. Compounding it inflates the claim and gives the other side an easy reason to dispute the whole thing.

Can I claim interest without saying so in my contract?

In the UK and the EU, yes. The statutory right applies to business-to-business debts whether or not your contract mentions it, and a contract term that removes it can be challenged as unfair. In the United States you generally need the term in the contract, which is why it is worth putting it there.

Do I have to charge it?

No. It is a right, not an obligation, and plenty of people never invoke it. Knowing the number is still useful: it changes the conversation from a favour you are asking for into money that is accruing.

Does the interest apply to the VAT on the invoice too?

Yes. Statutory interest runs on the full amount that was owed and unpaid, which includes the VAT element.

How late does an invoice have to be?

Interest starts the day after the agreed due date. If no date was agreed, the default under UK and EU rules is 30 days from delivery of the goods or service, or from receipt of the invoice, whichever is later.

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