Late Payment Interest Calculator
Calculate statutory interest on overdue invoices under the Late Payment of Commercial Debts Act 1998. Free tool for UK freelancers and small businesses.
UK law entitles you to charge 8% above the Bank of England base rate on overdue B2B invoices — automatically, without needing it stated in your contract.
The date payment was due (e.g. 30 days after invoice date)
Results
Enter your invoice amount and dates above to see the interest owed.
This calculator provides an estimate based on the Late Payment of Commercial Debts Act 1998. The Bank of England base rate used here (5.25%) is illustrative and may have changed. Always verify the current rate before pursuing a claim.
What is UK statutory late payment interest?
The Late Payment of Commercial Debts (Interest) Act 1998 gives UK businesses the automatic right to charge interest on overdue B2B invoices. You do not need to include this in your contract — the right exists by law. The statutory rate is 8% above the Bank of England base rate, applied to the outstanding debt for each day it remains unpaid.
How is the interest calculated?
The interest accrues daily from the date the invoice became overdue. The formula is:
Where the annual rate = Bank of England base rate + 8%. Payment terms default to 30 days for B2B contracts unless otherwise agreed. Interest starts accruing the day after the payment due date.
Can I also claim debt recovery costs?
Yes. Under the Act you can also claim a fixed debt recovery charge on top of the interest:
- •£40 for debts under £1,000
- •£70 for debts between £1,000 and £9,999.99
- •£100 for debts of £10,000 or more
These charges help cover administrative costs of chasing payment. If your reasonable recovery costs exceed the fixed amount, you can claim the higher figure.
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