How to claim UK late payment interest on overdue invoices
A plain-English walkthrough of statutory interest and fixed recovery compensation for UK business-to-business overdue invoices — then a free calculator to estimate the numbers before you send a claim.
Not legal advice. This summarises public GOV.UK / OSBC guidance for qualifying commercial debts. Contracts with a different substantial interest remedy can change what you may claim. Check the official sources linked below before you invoice.
Estimates statutory interest + £40 / £70 / £100 compensation. Runs in your browser. No signup.
1. Does statutory interest apply?
Usually B2B (business or public authority customer) for goods/services on credit.
You do not need a contract clause for the statutory right — it arises under the Late Payment of Commercial Debts (Interest) Act 1998.
If your contract sets a different interest rate / substantial remedy, you generally cannot also claim statutory interest. You cannot claim both.
Consumer (B2C) invoices are outside this Act’s commercial late-payment scheme.
2. What rate and what compensation?
Statutory interest = Bank of England reference rate for the period + 8% per year, calculated daily on the overdue amount (include VAT on the invoice total when calculating).
The reference rate is fixed for half-year windows (rate on 31 Dec for Jan–Jun debts; rate on 30 Jun for Jul–Dec debts) — see OSBC guidance. Do not blindly use “today’s Bank Rate” without checking which reference applies to when interest started.
Debt size (invoice)
Fixed compensation
Under £1,000
£40
£1,000 – £9,999.99
£70
£10,000+
£100
You can usually claim interest and the fixed sum. Interest typically runs from the day after the due date until paid (or your as-of date).
3. Steps to claim
Confirm the due date has passed. If none was agreed, default timing is often 30 days after delivery/notice of the amount (see GOV.UK).
Check the contract for a different interest rate or substantial remedy.
Calculate statutory interest + fixed compensation for the overdue period. Use the free calculator below, then cross-check with the official OSBC tool if you want a second estimate.
Send a new invoice / statement that references the original invoice number, itemises interest and compensation, and sets a clear pay-by date.
Chase in writing (email is fine). Keep a paper trail. If still unpaid, consider further recovery options (e.g. Money Claim Online) — get advice if unsure.
Free OpsKit Digital calculator · same page as the live offer
4. Worked idea (illustrative)
GOV.UK’s worked style: if you were owed £1,000 and the applicable annual statutory rate were 8.5%, annual interest = £85 → about 23p per day → after 50 days ≈ £11.50 interest (plus the matching fixed compensation band). Always plug your amount, dates, and reference rate into a calculator.
Paid version (not checkout on this page): £19 chase pack + calculator. Checkout opens when the OpsKit Digital store is live. This guide does not take payment.