Late payment interest calculator (UK statutory)

How to use it

Enter your figures above — the result updates instantly and nothing leaves your browser. Results are illustrative, not a quote, tax computation or credit decision.

How to interpret the result

The figure the calculator produces is a ceiling, not a forecast of what a customer will actually pay. It shows the maximum you are legally entitled to add to an overdue invoice — statutory interest plus the fixed compensation band — assuming the debt qualifies and you choose to enforce your rights in full. Whether a customer settles that additional amount without dispute is a separate commercial question from whether you are entitled to charge it.

Use the result as a reference point in a conversation with the customer, or as the basis for a formal demand, rather than as a number you book into your accounts before payment lands. Because the calculation compounds with every extra day of delay, re-running it close to the point of chasing or issuing a demand keeps the figure accurate — a result generated weeks earlier will understate what has since accrued.

Limitations and good practice

This tool assumes the debt is a straightforward business-to-business commercial transaction and does not account for contract terms that vary the statutory position, part-payments already received, or disputes over the underlying invoice itself — all of which change the real recoverable amount. It is an illustration, not a debt-recovery calculation prepared with sight of your contract or ledger.

Good practice is to keep dated records of the original invoice terms, delivery or completion, and every reminder sent, since these underpin any claim for statutory interest and compensation if a customer challenges it. Many businesses also raise the prospect of statutory interest early and informally, alongside routine credit control, rather than holding it back as a last resort — it tends to work better as part of a consistent chasing process than as a one-off threat. See the early payment discount calculator for the flip side of the same relationship: what it costs to reward customers who pay ahead of time, rather than penalise those who pay late.