Late Payment Interest Calculator

Estimate statutory interest and fixed recovery costs for a qualifying late commercial payment under the Late Payment of Commercial Debts (Interest) Act 1998.

The unpaid amount, excluding any interest.

The date your payment terms expired.

Today, or the date it was paid.

Statutory interest
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Fixed recovery costs
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Total you can claim
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Why the due date decides the rate

This is the part most calculators get wrong, and it is worth understanding before you quote a figure at a customer.

Statutory interest is not 8% above whatever the Bank of England base rate happens to be today. It is 8% above the base rate in force on a fixed reference day: 30 June for interest that starts to run between 1 July and 31 December, or 31 December for interest starting between 1 January and 30 June, immediately before the interest starts running (Late Payment of Commercial Debts (Rate of Interest) (No. 3) Order 2002, article 4).

That rate is then fixed for the whole life of the debt. It does not move when the Bank of England changes rates afterwards. Interest that started running on 1 July 2023 carries a 13.00% statutory rate, while interest starting in the second half of 2026 carries 11.75%. Enter the due date above and the calculator picks the right reference day for you.

Fixed recovery costs

Separately from interest, you can claim a flat sum once per late payment (GOV.UK):

  • £40 on invoices up to £999.99
  • £70 on invoices from £1,000 to £9,999.99
  • £100 on invoices of £10,000 or more

If your reasonable costs of recovering the debt come to more than the fixed sum, you can claim the difference as well. To add either amount to what a customer owes, raise a new invoice for it.

Statutory interest rates by period

The reference rate for each six-month period since 2016. Base rates come from the Bank of England's official Bank Rate history. The reference-day rule comes from article 4 of the 2002 Order.

Interest starts to runReference dayBase rateStatutory rate
to 3.75%11.75%
to 3.75%11.75%
to 4.25%12.25%
to 4.75%12.75%
to 5.25%13.25%
to 5.25%13.25%
to 5.00%13.00%
to 3.50%11.50%
to 1.25%9.25%
to 0.25%8.25%
to 0.10%8.10%
to 0.10%8.10%
to 0.10%8.10%
to 0.75%8.75%
to 0.75%8.75%
to 0.75%8.75%
to 0.50%8.50%
to 0.50%8.50%
to 0.25%8.25%
to 0.25%8.25%
to 0.50%8.50%

Knowing the figure is not the same as charging it

This calculator gives the statutory arithmetic where the right applies. Whether the debt qualifies and whether to claim are separate questions.

In our experience of running billing for UK telecoms resellers, suppliers tend to keep statutory interest in reserve rather than apply it across every account. That is an observation from our customer base, not a general recovery-rate statistic. The full argument is on our product site in why statutory interest rarely works.

What does work is a consistent chasing routine. Our guide to the credit control process sets one out, and the aged debt report is where you find out whether it is working.

The rules are changing

The Commercial Payments Bill, introduced in May 2026, proposes a 60-day maximum for standard commercial terms, subject to limited exemptions, mandatory statutory interest and wider enforcement powers. It is not yet law and the government says it will not be retrospective. We covered the announcement in our King's Speech update.

Frequently asked questions

Which Bank of England base rate applies to a late invoice?

Not the current one. The rate is fixed by the base rate in force on 30 June (for interest that starts to run between 1 July and 31 December) or 31 December (for 1 January to 30 June), immediately before the day statutory interest starts running (Rate of Interest (No. 3) Order 2002, article 4). Once set, that rate applies for the whole life of the debt. It does not move when the Bank of England changes rates later.

How much interest can I charge on a late commercial invoice?

For a qualifying commercial debt, statutory interest is 8% above the applicable reference base rate and accrues daily from the day after payment became overdue (GOV.UK). If your contract sets its own rate of interest, you claim that instead of the statutory rate. The one exception is a contract with a public authority, where you cannot use a lower rate than the statutory one. The calculator picks the reference rate from the due date.

What is the fixed sum I can claim on top of interest?

You can claim a fixed amount towards recovery costs as well as interest: £40 on invoices up to £999.99, £70 on invoices from £1,000 to £9,999.99, and £100 on invoices of £10,000 or more (GOV.UK). You can only claim it once per late payment. If your reasonable recovery costs exceed the fixed sum, you may claim the difference.

When does an invoice legally become late?

If you agreed a payment date, the invoice is late once that date passes. If you did not agree one, the law treats the payment as late 30 days after either the customer gets the invoice or you deliver the goods or service, whichever is later. Any date you do agree must usually be within 30 days for a public authority or 60 days for a business, though a longer period is allowed for business transactions if it is fair to both sides (GOV.UK). Enter that date as the payment due date above.

Should I actually charge statutory interest?

That is a commercial decision, not part of the calculation. In our experience with UK telecoms resellers, suppliers tend to keep statutory interest in reserve rather than apply it routinely. We set out that experience in our post on why statutory interest rarely works.

Does this calculator give legal advice?

No. It applies the arithmetic in the Late Payment of Commercial Debts (Interest) Act 1998 to the figures you enter. It does not know your contract terms, whether a different rate was validly agreed, whether the debt is disputed, or whether any part was paid along the way. Check the position with your accountant or solicitor before relying on a figure in correspondence.

This calculator is provided for general information and does not constitute legal or financial advice. It assumes the debt was unpaid in full for the whole period and that no different rate was validly agreed in your contract. Check your terms and take professional advice before relying on a figure in correspondence.

Chasing less would be better than calculating more

Our CRM runs credit control from live invoice data, so overdue invoices get chased on schedule without anyone remembering to do it.

See how it works