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Statutory interest and compensation on overdue business invoices. Free, instant, and no sign-up needed.
Enter the base rate in force when the debt became overdue. Check the Bank of England website.
Applies to business-to-business debts under the Late Payment of Commercial Debts (Interest) Act 1998, unless your contract sets a substantial alternative remedy.
Claimable on top of the invoice
£119.32
We will send your figures and a short note on what to check. An accountant may follow up if you ask a question.
UK businesses can charge interest on overdue business-to-business invoices at 8% above the Bank of England base rate, plus fixed compensation of £40 for debts under £1,000, £70 for £1,000 to £9,999.99 and £100 for £10,000 or more. Interest runs daily from the day after the due date.
The Late Payment of Commercial Debts (Interest) Act 1998 applies to commercial debts between businesses, unless your contract provides a substantial alternative remedy. It does not apply to consumers.
Interest is the debt multiplied by the annual rate (base rate plus 8%) multiplied by the number of days overdue divided by 365. The base rate used is the one in force on the day the debt became overdue.
Most businesses use the right to charge interest as leverage rather than collecting it. Stating it on your invoices and terms, and sending a reminder, often brings payment without a dispute.
Last checked November 2026 against GOV.UK: Late commercial payments. General information, not advice.
Statutory interest
Debt under £1,000
£1,000 to £9,999.99
£10,000 or more
A £5,000 invoice 30 days overdue with a 4% base rate accrues £49.32 interest plus £70 compensation, so £119.32 can be claimed on top of the invoice.
What the number means, what it leaves out and what to do next.
Under the Late Payment of Commercial Debts law, a business can charge statutory interest at 8% above the Bank of England base rate on overdue invoices, plus a fixed sum of £40, £70 or £100 depending on the size of the debt. The calculator adds the two and shows the interest per day.
The base rate you enter changes the daily figure, so use the rate in force when the debt became overdue.
It covers contracts between businesses for goods and services, where the supplier and the buyer are both businesses. It does not apply to consumers. A contract can set its own interest rate if it provides a substantial remedy, and in that case the contract's terms apply.
You can also claim reasonable recovery costs beyond the fixed sum if they exceed it.
Most late payers respond to a clear, polite letter that sets out the invoice, the date it was due and the interest and compensation that apply. Often the prospect of added cost is enough to bring payment forward.
If a debt stays unpaid, we can help you decide whether to chase, use a collection route or write it off.
Clear payment terms make a claim easier.
Interest runs from the day after the due date.
You will need evidence the work was done.
No, it is your right, not an obligation. Many businesses state it in their terms and apply it selectively.
A contractual remedy can replace the statutory one only if it is substantial and fair. Otherwise the statutory right still applies.
Yes. Our invoicing and credit control service sends reminders and chases overdue payments for a flat £15 an hour.
Tell us about your company and we will confirm the best way to pay yourself, and a fixed fee.