📅 Free Late Payment Calculator — Instant results
Late Payment Interest Calculator
Calculate interest charges on overdue invoices. Enter your invoice amount, date, payment terms and interest rate to find exactly how much a client owes.
Late Payment Interest — Your Legal Rights
When a client pays late, you have the right to charge interest on the overdue amount. This calculator helps you calculate exactly how much to charge.
How to Add Late Payment Interest to an Invoice
- Calculate the number of days the payment is overdue
- Apply the agreed or statutory interest rate (usually 8-12% per year)
- Formula: Interest = Amount × Rate × (Days / 365)
- Add this to the original invoice amount
- Send a new invoice clearly showing the late payment charges
Standard Late Payment Rates by Region
- UAE: Commercial rate typically agreed in contract, default 12% per annum
- UK: Statutory rate = Bank of England base rate + 8%
- EU: Statutory rate = ECB reference rate + 8%
- USA: Varies by state, typically 10-18% per annum
💡 Always include payment terms and late payment clauses in your contracts and invoices. This protects your right to charge interest on overdue payments.
Frequently Asked Questions
Can I charge interest on late invoices?
Yes, in most jurisdictions you have the right to charge interest on overdue invoices. The rate should ideally be specified in your contract or invoice terms. If not specified, statutory rates apply depending on your country.
What is a reasonable late payment interest rate?
Common rates are 1-2% per month (12-24% per year) for commercial invoices. In the UAE, 12% per annum is commonly used. Always check local laws and your contract terms before charging.
How do I calculate late payment interest?
Simple interest formula: Interest = Principal × Rate × Time. Where Rate is the annual rate as a decimal (8% = 0.08) and Time is days overdue divided by 365. For example: AED 10,000 × 0.12 × (30/365) = AED 98.63 interest for 30 days at 12%.