For UK businesses
Late payment interest calculator
Work out statutory interest and fixed compensation when a UK business pays a commercial invoice late, under the Late Payment of Commercial Debts (Interest) Act 1998.
Rates last checked on 9 November 2026.
Bank Rate is 4% from 5 November 2026. Statutory interest for 1 July 2026 to 31 December 2026 is 11.75%, using the 3.75% rate on 30 June 2026, plus 8 percentage points. The example below is a £10,000 invoice that was 60 days late in spring 2026.
Interest by period
| Period | Days | Rate | Interest |
|---|---|---|---|
| 2 March 2026 – 30 April 2026 | 60 | 11.75% | £193.15 |
Demand letter
The free letter is calculated again when you download the PDF. The paid pack is a polite reminder, a final notice, and a notice before you consider a claim.
Your business
9 November 2026
The customer
Dear The customer,
Overdue invoice INV-1044
I am writing about goods or services supplied. Invoice INV-1044 for £10,000.00 was due on 1 March 2026. It was paid on 30 April 2026.
Under the Late Payment of Commercial Debts (Interest) Act 1998, statutory interest runs from the day after the due date. The rate is 8 percentage points above the Bank of England base rate in force on the reference date: 31 December for 1 January to 30 June, and 30 June for 1 July to 31 December. Interest for each period is the invoice amount × the statutory rate × the number of days ÷ 365.
A fixed sum is also due once, under section 5A of the Act, for the cost of recovering the debt: £40 under £1,000, £70 from £1,000 to £9,999.99, and £100 for £10,000 or more.
Invoice amount: £10,000.00 Due date: 1 March 2026 Payment date: 30 April 2026 Days late: 60 2 March 2026 to 30 April 2026: 60 days at 11.75% (Bank Rate 3.75% on 31 December 2025, plus 8 percentage points) = £193.15. Interest: £193.15 Fixed compensation: £100.00 Total due: £10,293.15
Please pay £10,293.15 within 7 days. If the due date or the amount is wrong, or a contract sets a different rate of interest, write to us straight away. This letter was prepared with Settlebell as a guide. It is not legal advice and it is not a court claim.
Yours faithfully,
Your business
Total due
£10,293.15
- Invoice
- £10,000.00
- Days late
- 60
- Daily interest now
- £3.22
- Interest
- £193.15
- Compensation
- £100.00
Daily interest is the current rate shown per day. The interest total uses the full formula, not the rounded daily figure times the days.
Save & remind me if it's still unpaid
The free letter is on this page. An account keeps the invoice and can remind you if it is still unpaid. During the beta that is free. Free is 5 active invoices. Starter is £9 a month or £90 a year, with 50 active invoices. Pro is £19 a month or £190 a year, with a fair-use cap. Nothing is billed yet.
Save & remind me if it's still unpaidHow this is worked out
If another business pays a commercial invoice late, the Late Payment of Commercial Debts (Interest) Act 1998 gives you statutory interest unless the contract already sets a substantial remedy. The rate is 8 percentage points above the Bank of England base rate. It is not the base rate on the day you do the sum.
The year is split in two. From 1 January to 30 June, use the Bank Rate in force on 31 December. From 1 July to 31 December, use the Bank Rate in force on 30 June. If a debt runs across both, each half is worked out on its own rate. A rise in Bank Rate today does not change the statutory rate until the next reference date.
Interest starts the day after the due date. The sum for each period is the invoice amount × the statutory rate × the number of days ÷ 365, rounded to the nearest penny. The divisor stays 365 in a leap year. You can also claim a fixed sum once: £40 under £1,000, £70 from £1,000 to £9,999.99, and £100 for £10,000 or more. Reasonable recovery costs above that fixed sum are a separate claim, and this calculator does not estimate them.
This applies to business-to-business debts for goods and services. It does not apply to a consumer invoice. If your contract sets a different rate, that rate may replace the statutory one. The letter on this page is a draft you can edit. It is not a claim form.
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For guidance only. This is not financial advice, legal advice, or a mortgage offer. Check the original invoice, contract, or lender illustration before you rely on a figure.