Invoice Late Fee Calculator
Calculate statutory interest and compensation on an overdue invoice.
About this calculator
When a business customer pays late, UK law (the Late Payment of Commercial Debts legislation) lets you charge statutory interest — 8% a year above the Bank of England base rate — plus a fixed compensation amount per invoice. This calculator works out the daily interest, the interest accrued so far and the total you can add to the invoice. Sometimes just showing this number to a late payer is enough to get the invoice settled.
The formula
Worked example
A £1,500 invoice is 30 days overdue at 12.25% (8% + 4.25% base rate), with £70 fixed compensation:
- Daily interest = £1,500 × 0.1225 ÷ 365 = £0.50
- Interest = £0.50 × 30 = £15.10
- Total late fee = £15.10 + £70 = £85.10
Common mistakes
- Using the statutory rate against consumers — it applies to business-to-business debts.
- Counting from the invoice date instead of the date payment became overdue.
- Forgetting the fixed compensation, which is often worth more than the interest on small invoices.
Frequently asked questions
Assumptions & limitations
Simple (non-compounding) daily interest as per UK statutory rules, applied to business-to-business debts. If your contract sets its own late-payment terms, those may apply instead. Not legal advice.
Sources & verification
- Late commercial payments: charging interest and debt recovery — GOV.UK — statutory interest (Bank of England base rate + 8%) and fixed compensation
All sources last accessed 24 July 2026.
Spotted an error or an out-of-date figure? Report it — corrections are prioritised over all other work (see our corrections policy).