UK Late Payment Interest Calculator (2026)
When another business pays your invoice late, UK law lets you add statutory interest at the Bank of England rate plus 8% a year, and a fixed sum of £40, £70 or £100. Enter the invoice and the dates to see what you can add, with the working shown. Free, and worked out in your browser.
Interest plus compensation
£193.94
at 11.75% a year · estimate only
Interest
£123.94
Fixed sum
£70.00
Total owed
£5,193.94
Rate: interest started on 16 July 2026, so it uses the Bank of England rate on 30 June 2026 (3.75%) plus 8% = 11.75% a year. That rate stays the same until the debt is paid.
Interest: £5,000.00 × 11.75% ÷ 365 = £1.6096 a day, × 77 days = £123.94.
Fixed sum: £70.00 for a debt of this size. If your reasonable costs of recovering the debt are higher, you can also claim the difference.
How Statutory Interest Works
The Late Payment of Commercial Debts (Interest) Act 1998 applies across the UK to contracts for goods or services where both sides are acting in the course of a business. Interest starts the day after payment was due. If you agreed a payment date, that is the due date. If you did not, payment is due at the end of the 30 days starting with the later of the day you delivered and the day the customer got your invoice.
The rate is the Bank of England base rate plus 8% a year. The base rate used is the one in force on 30 June (for interest that starts between 1 July and 31 December) or 31 December (for interest that starts between 1 January and 30 June). That rate is fixed when interest starts and does not change while the debt is unpaid, even if the base rate moves. Interest is simple, not compound: the yearly amount divided by 365 gives the daily figure.
On top of interest you can claim a fixed sum for the cost of recovering the debt: £40 for a debt under £1,000, £70 for £1,000 or more but under £10,000, and £100 for £10,000 or more. If your reasonable recovery costs are higher, you can claim the difference too.
Worked example. A £5,000 invoice was due on 15 July 2026 and paid on 30 September 2026. Interest runs from 16 July, so it uses the 30 June 2026 base rate of 3.75%, giving 11.75% a year. That is £5,000 × 11.75% ÷ 365 = £1.61 a day for 77 days, about £123.94, plus the £70 fixed sum. gov.uk's own example rounds the daily figure first (to the nearest penny) before multiplying, which can change the result by a few pence.
To claim it, send a new invoice or a demand that adds the interest and fixed sum, then use our letter before action generator if it still is not paid. If you go to court, the court fee calculator shows what issuing will cost.
Late Payment Interest Rates by Half-Year
| Interest starts | Base rate on the reference date | Statutory rate |
|---|---|---|
| 1 Jul 2026 to 31 Dec 2026 | 3.75% on 30 Jun 2026 | 11.75% |
| 1 Jan 2026 to 30 Jun 2026 | 3.75% on 31 Dec 2025 | 11.75% |
| 1 Jul 2025 to 31 Dec 2025 | 4.25% on 30 Jun 2025 | 12.25% |
| 1 Jan 2025 to 30 Jun 2025 | 4.75% on 31 Dec 2024 | 12.75% |
| 1 Jul 2024 to 31 Dec 2024 | 5.25% on 30 Jun 2024 | 13.25% |
| 1 Jan 2024 to 30 Jun 2024 | 5.25% on 31 Dec 2023 | 13.25% |
| 1 Jul 2023 to 31 Dec 2023 | 5% on 30 Jun 2023 | 13% |
| 1 Jan 2023 to 30 Jun 2023 | 3.5% on 31 Dec 2022 | 11.5% |
| 1 Jul 2022 to 31 Dec 2022 | 1.25% on 30 Jun 2022 | 9.25% |
| 1 Jan 2022 to 30 Jun 2022 | 0.25% on 31 Dec 2021 | 8.25% |
| 1 Jul 2021 to 31 Dec 2021 | 0.1% on 30 Jun 2021 | 8.1% |
| 1 Jan 2021 to 30 Jun 2021 | 0.1% on 31 Dec 2020 | 8.1% |
| 1 Jul 2020 to 31 Dec 2020 | 0.1% on 30 Jun 2020 | 8.1% |
The rate for interest starting from 1 January 2027 depends on the base rate on 31 December 2026 and will be added then.
What the Calculator Does Not Cover
It does not apply to debts owed by consumers. If your contract sets its own interest or other remedy for late payment, that remedy replaces statutory interest unless it is both too small to compensate you or deter late payment and unfair to rely on; a term that tries to exclude statutory interest without such a remedy is void. Payment terms longer than 60 days can be challenged if they are grossly unfair to the supplier, and public-sector customers have tighter limits; the calculator uses the date you enter. It covers interest starting from 1 July 2020, and does not work out court interest after judgment.
Frequently Asked Questions
What is the late payment interest rate in the UK?
For interest that starts between 1 July and 31 December 2026 it is 11.75% a year: the Bank of England base rate of 3.75% on 30 June 2026 plus 8%. The rate is set twice a year and stays fixed for the life of each debt.
Can I charge late payment interest to a consumer?
Not under the 1998 Act, which only covers business-to-business contracts. You can charge interest to a consumer only if your contract allows it, or ask the court to award interest if you make a claim.
Do I have to warn the customer before adding interest?
No. Unless your contract sets its own substantial remedy for late payment, the right to statutory interest is implied into the contract, so it applies automatically once payment is late. In practice, send a new invoice or letter showing the interest and fixed sum you are adding.
Is the £40, £70 or £100 charged per invoice?
The fixed sum applies to each qualifying debt that is paid late, based on the size of that debt: £40 under £1,000, £70 from £1,000 to under £10,000, and £100 for £10,000 or more.
Does this tool store or send my information anywhere?
No. All of the maths runs in your browser. Nothing you type is saved or sent anywhere.
Checked on 26 September 2026 against the Late Payment of Commercial Debts (Interest) Act 1998 (sections 2, 4, 5A, 8 and 9), the Late Payment of Commercial Debts (Rate of Interest) (No.3) Order 2002 (and the matching Scottish order, SSI 2002/336) and the Bank of England base rate history. This is general information, not legal advice, and RecordingLaw.com is not affiliated with the UK government or the Bank of England.
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