Late Payment Interest Calculator
Enter the invoice amount, the due date and the day it was settled. You get interest at 8% over the Bank of England base rate and the fixed sum for the size of the debt.
Change the rate
This is an estimate and not advice. This applies to payments between businesses, and to public authorities. It does not apply to payments by consumers.
Worked examples
A £1,000 invoice, 50 days late
Due 1 August 2026, settled 20 September 2026
£16.10 interest plus £70
The base rate on 30 June 2026 was 3.75%, so the rate is 11.75%. £1,000 x 11.75% x 50 / 365 = £16.10. Total owed £1,086.10.
A £12,000 invoice, 45 days late
Due 15 February 2026, settled 1 April 2026
£173.84 interest plus £100
The base rate on 31 December 2025 was 3.75%, so 11.75% a year. Total owed £12,273.84.
A £500 invoice, 30 days late
Due 1 March 2026, settled 31 March 2026
£4.83 interest plus £40
Even a small invoice earns the fixed sum, which is often worth more than the interest.
About Late Payment Interest Calculator
If another business pays your invoice late, the law lets you charge interest and a fixed sum for the trouble of chasing. Many small firms never claim it because they are not sure what the figure is. The interest is 8% a year over the Bank of England base rate, and the fixed sum is £40 for a debt under £1,000, £70 for a debt from £1,000 to £9,999.99 and £100 for £10,000 or more. Together they can make a late invoice noticeably more expensive for the customer.
The base rate used is the one in force on 30 June for a debt that falls due between 1 July and 31 December, and the one on 31 December for a debt that falls due between 1 January and 30 June. This calculator looks that rate up for your due date, adds 8%, and works out simple interest for each day the invoice went unsettled, on a 365 day year, as GOV.UK does. If your contract sets its own late payment rate, or the invoice had no agreed payment date, you can handle both.
How to use Late Payment Interest Calculator
- Enter the amount owed, which is normally the invoice total.
- Enter the due date, or choose that no date was agreed and enter the date the customer got the invoice or the goods or service.
- Choose the date the invoice was settled, or leave today if it is still owed.
- Read the interest, the fixed sum and the total now owed, and copy the figures into your reminder.
Common uses
- Adding the right figures to a chaser letter
- Deciding whether a long overdue invoice is worth pursuing
- Checking the amount before you ask a customer for interest
- Showing a customer the cost of paying late
Frequently asked questions
Does this apply to every customer?
It applies to payments between businesses, and to public authorities. It does not apply to sales to consumers. Your contract can set a different late payment rate if it is a substantial remedy, and the tool lets you enter that rate instead.
What happens if no payment date was agreed?
The law treats the invoice as late 30 days after the customer receives it or the goods or service are delivered, whichever is later. Choose the option for no agreed date and enter that later date.
Is the interest compound?
No. The interest is simple interest: the amount, times the yearly rate, times the days late, divided by 365. It does not build up on itself.
Is the fixed sum charged on every invoice?
Yes, it applies to each late invoice separately. A customer who pays three invoices late owes the fixed sum three times, each according to the size of that invoice.
Which base rate is used when the due date is in the future?
The rate for a period is only known once the reference date has passed. For a due date in a period where it is not yet set, the tool asks you to enter the base rate yourself.