Late payment interest calculator
Work out statutory interest and compensation on a late business payment under the Late Payment of Commercial Debts (Interest) Act 1998, or use your contract's own interest rate.
Free, no sign-in. Nothing you type is stored or sent anywhere — it's all worked out in your browser.
Enter the amount, the due date and the payment date.
Not legal or tax advice — check your contract. Your contract terms and the facts of your job can change the answer.
How this works
When interest starts. Statutory interest starts the day after the payment was due — the agreed payment day or the final date for payment (s.4(2)). It runs every day until the debt is paid.
The rate is 8% a year over Bank Rate. If interest starts between 1 July and 31 December, it's Bank Rate on 30 June. If it starts between 1 January and 30 June, it's Bank Rate on the 31 December before (Rate Order 2002, art.4). That rate stays fixed for the whole debt.
Daily simple interest: debt × annual rate ÷ 365 × days late.
Fixed sum (s.5A(2)): £40 if the debt is under £1,000, £70 for £1,000 to under £10,000, £100 for £10,000 or more.
Contract rate. If your contract gives a "substantial remedy" for late payment (for example an interest rate in the Contract Data), that rate applies instead of statutory interest (ss.8–9). This tool then shows contract interest only, without the statutory fixed sum.
Bank Rate comes from the Bank of England's statistics database and is refreshed daily.
FAQs
What is the statutory late payment interest rate?
8% a year over the Bank of England's Bank Rate (the 'reference rate'). The rate is fixed for each half-year, depending on when interest starts to run.
Which Bank Rate do I use?
The rate on 30 June for interest that starts between 1 July and 31 December, or on 31 December for interest that starts between 1 January and 30 June (Rate of Interest Order 2002, art.4).
How much fixed-sum compensation can I claim?
£40 for a debt under £1,000, £70 for £1,000 to under £10,000, and £100 for £10,000 or more (Late Payment Act s.5A(2)). You can also claim reasonable recovery costs above that.
Is it simple or compound interest?
Simple interest, worked out daily: debt × rate ÷ 365 for each day it's late.
Can my contract set a different rate?
Yes, if the contract gives a 'substantial remedy' for late payment, its rate replaces statutory interest (ss.8–9). A remedy that isn't substantial can be set aside.
Civvio works this out automatically from your contract and site records.
Upload the contract and keep your diary, and Civvio flags the dates, notices and money at risk on every job — for you to review before anything is sent.
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