Late payment interest calculator
Chasing an overdue invoice? Work out exactly what you are owed: statutory interest at the Bank of England base rate plus 8%, plus the fixed compensation the law entitles you to. For UK business-to-business debts.
Enter the overdue invoice amount, the date it was due and the Bank of England base rate at the time. We work out the statutory interest and the fixed compensation you are entitled to.
What you are entitled to charge
Under the Late Payment of Commercial Debts (Interest) Act 1998, if another business pays you late you can charge two things without it needing to be in your contract:
- Statutory interest of 8% plus the Bank of England base rate, accruing daily on the overdue amount from the day after payment was due.
- Fixed compensation, a one-off sum per invoice: £40 for debts under £1,000, £70 for £1,000 to £9,999.99, and £100 for £10,000 or more.
The interest formula
Statutory interest = overdue amount × (base rate + 8%) ÷ 365 × days late. So on a £5,000 invoice, 30 days late, with a 4.75% base rate: the statutory rate is 12.75%, which is about £1.75 a day, or roughly £52 for the 30 days, plus £70 fixed compensation.
When is a payment officially late?
If you agreed a payment date, the debt is late the day after it passes. If nothing was agreed, the Act sets a default of 30 days after the customer receives the invoice, or the goods or service, whichever is later. You can also claim any reasonable extra costs of recovering the debt beyond the fixed compensation.
This is general information, not legal advice. Check the current Bank of England base rate and GOV.UK guidance before sending a demand.
Stop invoices going overdue in the first place
Jeanus is a B2B CRM that tracks who owes you what, flags invoices the moment they slip past due and can chase them automatically, so you spend less time calculating interest and more time getting paid on time.