free uk tool
UK late payment interest & claim builder
Work out the statutory interest and fixed compensation you can claim on an overdue B2B invoice — 8% plus the Bank of England base rate, calculated to the day — then copy a ready-to-send demand letter. Free, no email required.
your claim
Enter your invoice amount and due date to see the statutory interest and fixed compensation you can claim — plus a copy-ready demand letter.
This is a calculation tool, not legal advice. It applies the Late Payment of Commercial Debts (Interest) Act 1998 for business-to-business debts. Statutory interest and fixed compensation do not apply to consumer debts, and different rules can apply where a contract sets its own substantial remedy. Verify figures against GOV.UK before you send a formal demand.
stop chasing invoices by hand
automate the whole payment chase.
A calculator fixes one invoice. We build the system behind it — automatic reminders, statutory-interest tracking, a client payment portal, and accounting integrations (Xero, QuickBooks, Stripe, GoCardless) so overdue invoices chase themselves.
how the claim is worked out
what UK law lets you charge on a late invoice.
When a UK business pays a commercial invoice late, the Late Payment of Commercial Debts (Interest) Act 1998 entitles the supplier to statutory interest and a fixed sum in compensation, even if the contract is silent on late payment. This calculator applies those rules to your figures and shows exactly how the number is built.
The claim has three parts:
- Statutory interest — 8% a year plus the Bank of England base rate, charged as simple daily interest on the unpaid debt from the day after it was due until it is paid.
- The reference base rate — fixed by when the debt became overdue: the base rate on the previous 31 December (for debts overdue January–June) or 30 June (July–December). It stays the same for the whole claim.
- Fixed compensation — a flat recovery-cost sum: £40 under £1,000, £70 up to £9,999.99, and £100 at £10,000 or more.
The tool adds these together into the total you can demand, and drafts a letter that cites the Act and itemises each line — the wording most small businesses struggle to phrase. Figures are indicative; confirm the current base rate and the rules on GOV.UK and with the Small Business Commissioner before sending a formal demand.
faq
late payment interest — frequently asked questions
How much interest can I charge on a late invoice in the UK?
For business-to-business debts you can charge statutory interest of 8% plus the Bank of England base rate. So if the base rate is 4.25%, the statutory rate is 12.25% a year. Interest is simple, not compound, and accrues daily from the day after the payment was due until the debt is paid. The calculator works out the daily amount and the running total for you.
What is the fixed compensation for late payment?
On top of interest, the Late Payment of Commercial Debts (Interest) Act 1998 lets you claim a fixed sum for the cost of recovering the debt: £40 for a debt under £1,000, £70 for a debt of £1,000 to £9,999.99, and £100 for a debt of £10,000 or more. You can claim it once per invoice, and you can also recover reasonable additional recovery costs above that sum.
Which Bank of England base rate applies to my claim?
The statutory rate is fixed for six-month periods. If your debt became overdue between 1 January and 30 June, you use the base rate in force on the previous 31 December. If it became overdue between 1 July and 31 December, you use the base rate in force on the previous 30 June. That reference rate applies for the whole claim, even if the base rate changes later. The calculator picks the right reference date from your due date and pre-fills the rate — you can override it.
How is late payment interest calculated?
Multiply the debt by the statutory rate (8% + base rate), divide by 365 to get the daily interest, then multiply by the number of days the invoice is overdue. For example, £5,000 at 12.25% is £612.50 a year, or about £1.68 a day; 30 days overdue is roughly £50.34 in interest, plus £70 fixed compensation. The calculator does this precisely from your figures.
Can I use this for a late payment demand letter?
Yes. Once you enter the invoice amount and dates, the tool generates a copy-ready demand letter that cites the Late Payment of Commercial Debts (Interest) Act 1998, itemises the principal, statutory interest and fixed compensation, and states the total due. Add your business name, the client's name and the invoice number to personalise it, then paste it into your own letterhead or email.
Does statutory interest apply to consumer or overseas invoices?
Statutory interest and fixed compensation under the 1998 Act apply to commercial (business-to-business and public-sector) debts in the UK. They do not apply to consumer debts, and different rules can apply where your contract sets its own substantial contractual remedy for late payment, or where the debt is governed by another country's law. If in doubt, check GOV.UK or take legal advice before sending a formal demand.
Can I automate chasing late invoices instead of doing this each time?
Yes — that's what we build at Appycodes. A calculator handles one invoice; a system handles all of them. We build automated reminder sequences, statutory-interest tracking, client payment portals, and integrations with Xero, QuickBooks, Stripe and GoCardless so overdue invoices chase and reconcile themselves. Book a scoping call to talk it through.
tired of chasing payment?
We build the automation behind the invoice — reminders, interest tracking, payment portals and accounting integrations. Book a thirty-minute call with the engineer who would run the build.