Late Payment Interest Calculator

Calculate statutory or contractual interest and compensation on a late invoice.

About Late Payment Interest Calculator

Statutory late payment regimes typically allow interest at a margin above a reference rate plus a fixed compensation sum. On small invoices the fixed sum can exceed the interest itself. The entitlement usually exists automatically without needing a contractual term, which many suppliers do not realise they can claim.

Formula

Late Payment Interest

Interest = amount × (base rate + statutory margin) × days ÷ 365, plus fixed compensation

statutory margin: A fixed percentage above the reference rate set by legislation
fixed compensation: A flat sum claimable in addition to interest in some jurisdictions

Worked example

With the default values below, Late Payment Interest Calculator returns Total Claimable of $8,706.23. Change any input above and every figure here is recalculated in your browser.

Inputs used

Invoice amountminimum 0: 8,500
Days overdueminimum 0 days: 45 days
Reference base rateaccepts 0–30 %: 5 %
Statutory margin above baseaccepts 0–30 %: 8 %
Fixed compensation amountminimum 0: 70

Results

Total Claimable: $8,706.23
Interest Accrued: $136.23
Daily Interest: $3.0274
Annual Interest Rate Applied: 13.00%
Cost to the Debtor as an Annual Rate: 19.68%

Step by step

1Values used
2Late Payment Interest
3Total Claimable= 8,706.23
4Interest Accrued= 136.23
5Daily Interest= 3.0274
6Annual Interest Rate Applied= 13.00
7Cost to the Debtor as an Annual Rate= 19.68

Assumptions and limits

The result is derived only from the 5 inputs listed above. Anything not among them is not part of the calculation.
In particular, this calculator does not take inflation, tax, fees or charges or compounding frequency into account.
Figures are rounded for display to 4 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
Late payment entitlements vary by jurisdiction and contract, and statutory rates change. This is a general illustration, not legal advice. Confirm the applicable rate and entitlement before claiming, and seek legal advice for disputed debts.
This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Late payment entitlements vary by jurisdiction and contract, and statutory rates change. This is a general illustration, not legal advice. Confirm the applicable rate and entitlement before claiming, and seek legal advice for disputed debts.

Frequently Asked Questions

How is Late Payment Interest calculated?

Interest = amount × (base rate + statutory margin) × days ÷ 365, plus fixed compensation Statutory late payment regimes typically allow interest at a margin above a reference rate plus a fixed compensation sum. On small invoices the fixed sum can exceed the interest itself.

Why does Late Payment Interest matter?

The entitlement usually exists automatically without needing a contractual term, which many suppliers do not realise they can claim.

What values do I need to enter?

This calculator takes 5 inputs: Invoice amount, Days overdue, Reference base rate, Statutory margin above base, Fixed compensation amount. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.