Can I charge interest on a late invoice?

If your client is a business, usually yes. In the UK the Late Payment of Commercial Debts (Interest) Act gives you the Bank of England base rate plus 8%, and a fixed compensation fee on top. The EU has a similar directive. If your client is a homeowner, you can only charge interest if your quote or terms said you would, which is a good reason to put a late payment line in your terms now.

How much late payment interest can I add in the UK?

Statutory interest is 8% plus the Bank of England base rate, calculated daily from the day after the due date. You can also add fixed compensation per invoice: 40 pounds for debts under 1,000, 70 pounds up to 10,000, and 100 pounds above that.

Will charging interest ruin the relationship with my client?

Mentioning it usually gets you paid without ever collecting it. The point of the calculation is the reminder message: a specific number, growing daily, moves your invoice to the top of their pile. Most tradespeople waive the interest the moment payment arrives.

Late payment interest calculator

The work is done, the invoice is weeks old, and the silence is costing you sleep. This works out exactly what you can add for late payment, and writes the sentence to send. A specific number that grows every day gets invoices paid faster than any amount of polite nudging. Nothing you type is saved or sent anywhere.

The overdue invoice

Invoice amount

The unpaid total on the invoice.

Date it was due

No due date? Use 30 days after you sent it.Bank of England base rate, %

Statutory rate is this plus 8%. Check today's rate.

Currency

Only changes how it's shown.

Statutory interest applies when your client is a business. For homeowners and other consumers you can only charge interest if your quote or terms said you would.

30 days overdue

£1,584.49

now due · climbing £0.48/day

Original invoice: £1,500.00
Interest at 11.8% a year: £14.49
Fixed compensation: £70.00

Paste into your reminder

This invoice for £1,500.00 is now 30 days past its due date. Under the Late Payment of Commercial Debts (Interest) Act 1998, statutory interest of £14.49 and compensation of £70.00 have been added, bringing the total due to £1,584.49. Please arrange payment at your earliest convenience.

SoloDesks chases unpaid invoices for you with one tap.

This is a general guide, not tax, legal or financial advice. Rates checked July 2026. Statutory interest applies to business-to-business debts, and the base rate changes over time. Always confirm the current rates and rules with HMRC or your accountant before relying on a figure.

What you can charge on a late invoice

If your client is a business (a company, a landlord letting commercially, another trade), the Act gives you a statutory right to:

Interest at base rate + 8%. Base rate is currently 3.75%, so 11.75%.
Fixed compensation per invoice, on top of the interest.
Reasonable debt recovery costs above that fixed sum, where you actually incurred them.

Fixed compensation, per invoice
Debt size	You can add
Under £1,000	£40
£1,000 to £9,999	£70
£10,000 and over	£100

The base rate is locked in for six months at a time: whatever it was on 30 June applies to debts falling due between 1 July and 31 December, and the 31 December rate applies from 1 January to 30 June. A base rate change tomorrow does not change what you can charge on an invoice that is already late.

Interest is only half the cost. The official research puts the time at 86 hours a year chasing payment. For a business of one, about 11 working days, or £2,200–£3,300 of billable capacity. Our analysis of the DBT and Small Business Commissioner figures shows the working.

If your client is a homeowner, this Act does not apply

It covers business-to-business contracts. Most solo trade work is for private customers, which means your right to charge interest comes from your own payment terms: the terms written on the quote your customer accepted.

So: if your quotes don't state a late payment term, you haven't got one. That is the most useful sentence on this page. Put the term on the quote, before the job, not on the invoice afterwards.

SoloDesks carries your payment terms onto every quote and invoice automatically, and Overdue Autopilot chases at 7, 14 and 21 days under your own business name. Start free.

Statutory figures under the Late Payment of Commercial Debts (Interest) Act 1998, per gov.uk. Bank of England base rate 3.75% as at 30 July 2026. This is legal information, not legal advice. If a debt is large enough to argue about, it's large enough to take an hour of a solicitor's time.

Last checked: 30 July 2026

Common questions

Can I charge interest on a late invoice?: If your client is a business, usually yes. In the UK the Late Payment of Commercial Debts (Interest) Act gives you the Bank of England base rate plus 8%, and a fixed compensation fee on top. The EU has a similar directive. If your client is a homeowner, you can only charge interest if your quote or terms said you would, which is a good reason to put a late payment line in your terms now.
How much late payment interest can I add in the UK?: Statutory interest is 8% plus the Bank of England base rate, calculated daily from the day after the due date. You can also add fixed compensation per invoice: 40 pounds for debts under 1,000, 70 pounds up to 10,000, and 100 pounds above that.
Will charging interest ruin the relationship with my client?: Mentioning it usually gets you paid without ever collecting it. The point of the calculation is the reminder message: a specific number, growing daily, moves your invoice to the top of their pile. Most tradespeople waive the interest the moment payment arrives.

Getting paid

The whole escalation, in order

From the invoice on the day you finish to a claim at the county court, with what to send at each stage.

Next, in getting paid

Raise it, send it, and chase it when it goes quiet.

Invoice & quote generator

Type the job, download a professional PDF invoice or quote, with VAT and CIS if you need them. Built in your browser, nothing uploaded.

Payment reminder generator

Chasing an overdue invoice? Fill in the details, pick friendly, firm or final, and get a message ready to send.

Pricing the job

Work out what the job should cost before you write the number down.

What you owe

Tax, VAT and CIS: the money that was never really yours to spend.

All nine are on the free tools page, and none of them need an account.