Late Payment Interest Calculator
Calculate what you're owed under UK law — free, no signup required
Under the Late Payment of Commercial Debts (Interest) Act 1998, you can charge statutory interest on overdue invoices at 8% plus the Bank of England base rate. You're also entitled to fixed compensation of £40-£100 depending on the invoice amount.
What is UK Statutory Interest?
The Late Payment of Commercial Debts (Interest) Act 1998 gives businesses the legal right to charge interest on overdue invoices for commercial transactions. The interest rate is set at 8% plus the Bank of England base rate.
How is Late Payment Interest Calculated?
Interest is calculated daily using this formula:
The interest rate combines a fixed 8% statutory rate with the Bank of England base rate that was in effect when the payment became overdue.
What Compensation Can I Claim?
In addition to interest, you can claim fixed compensation:
- £40 for debts under £1,000
- £70 for debts between £1,000 and £9,999.99
- £100 for debts of £10,000 or more
This compensation is designed to cover the administrative costs of chasing late payments and can be claimed on top of the statutory interest.