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UK Late Payment
Interest Calculator

Enter your invoice amount, due date, and payment date. We’ll calculate the statutory interest and compensation you’re owed under UK law — no sign-up required.

Calculate my interest

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11.75%Statutory interest rate Up to £100Fixed compensation 6 yearsTo make your claim FreeNo sign-up required 11.75%Statutory interest rate Up to £100Fixed compensation 6 yearsTo make your claim FreeNo sign-up required

Enter your invoice details

We'll calculate the statutory interest and compensation you're legally entitled to.

The date payment was due (usually 30 days after invoice)
Your statutory rights

What the law says about late payments

UK law automatically entitles you to all of these on every overdue B2B invoice — no contract clause needed.

11.75%
Annual interest rate
8% + BoE base rate (3.75%)
£40–£100
Fixed compensation
Per invoice, by statute
6 years
Time to claim
Limitation Act 1980
How it works

The 4-step process to recover your money

Most late payments aren't malicious — they're disorganised. A structured approach recovers the majority without court.

1

Friendly Reminder

Assume it's an oversight. A polite nudge resolves most cases.

2

Firm Follow-Up

Mention the Late Payment Act. Give a clear 7-day deadline.

3

Final Warning

State the total owed including interest and compensation. Last chance.

4

Letter Before Action

Legal prerequisite before court. Most debts are paid at this stage.

Late Payment Interest Calculator: How It Works

If you're a freelancer, contractor, or small business owner in the UK, late payment isn't just frustrating — it threatens your livelihood. The average UK small business is owed over £30,000 in unpaid invoices at any given time.

The good news: UK law is firmly on your side.

The Late Payment of Commercial Debts (Interest) Act 1998

This Act gives every UK business the automatic right to charge interest and claim compensation on late B2B invoices. You don't need to have included late payment terms in your contract.

  • Statutory interest: 8% above the Bank of England base rate. Current total: 11.75% per annum, accruing daily.
  • Fixed compensation: £40 for debts up to £999.99, £70 for £1,000 to £9,999.99, £100 for £10,000+.
  • Reasonable recovery costs: If fixed compensation doesn't cover your actual costs, you can claim more.

How to Calculate Late Payment Interest

Invoice amount x 11.75% / 365 x days overdue = interest owed

Example: £5,000 invoice, 60 days late: £5,000 x 0.1175 / 365 x 60 = £96.58 interest + £70 compensation = £166.58 on top of the original.

What Is a Letter Before Action?

A Letter Before Action (LBA) is a formal legal document notifying a debtor you intend to take court action. Under the Pre-Action Protocol for Debt Claims, you must send an LBA and allow 30 days before filing a county court claim. Most debts are paid at this stage.

FAQs

Frequently asked questions

How much interest can I charge on a late invoice in the UK? ▼
Under the Late Payment of Commercial Debts (Interest) Act 1998, you can charge statutory interest at 8% above the Bank of England base rate. As of 2026, the base rate is 3.75%, making the total rate 11.75% per annum.
Do I need late payment terms in my contract? ▼
No. The statutory right to charge interest and claim compensation applies automatically to all B2B transactions under UK law.
What is the fixed compensation for late payment? ▼
£40 for debts up to £999.99, £70 for debts between £1,000 and £9,999.99, and £100 for debts of £10,000 or more. Per invoice, not per debtor.
How long do I have to chase an unpaid invoice? ▼
6 years from the due date under the Limitation Act 1980 (England and Wales). 5 years in Scotland.
Does this apply to sole traders and freelancers? ▼
Yes. The Act applies to all business-to-business transactions regardless of business structure.
How do I take someone to small claims court? ▼
For debts under £10,000, file through Money Claim Online (moneyclaim.gov.uk). Send a Letter Before Action first and wait 30 days. Court fees: £35–£455. No solicitor needed.

Stop letting clients hold your cash.

Calculate what you're legally owed — then get the letters to collect it.

Calculate What You're Owed

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