Late Payment Interest Calculator
Calculate statutory interest and fixed compensation on an overdue commercial invoice — EU Directive 2011/7/EU and UK LPCD Act rates.
Source: European Central Bank, Bank of England · Rolling — current statutory reference rate · last verified 2026-08-29
Statutory late-payment interest, explained
When a business invoice goes unpaid past its due date, the creditor doesn't have to just wait and hope. Under EU Directive 2011/7/EU — implemented into national law across all 27 EU member states — and the UK's Late Payment of Commercial Debts (Interest) Act 1998, a creditor in a B2B (or public-authority) transaction is automatically entitled to charge statutory interest on the overdue amount, plus a fixed sum to cover the cost of chasing the debt, without needing to prove a single euro or pound of actual loss.
The statutory rate is set nationally and changes over time. Under the EU Directive, most member states peg it to a reference rate (commonly, but not always, the European Central Bank's main refinancing rate) plus a margin — 8 percentage points is the EU-wide default, though some states set a higher margin (Poland, for example, uses the National Bank of Poland's lombard rate plus 10 points). Rates are reviewed twice a year, on 1 January and 1 July. The UK sets its rate continuously as the Bank of England's base rate plus 8 percentage points, changing whenever the Bank's Monetary Policy Committee moves the base rate rather than on a fixed calendar. The current Bank of England base rate — and the ECB reference rate — can be checked on the Benchmark Rates page.
On top of interest, the Directive entitles a creditor to a fixed minimum recovery compensation per overdue invoice — €40 under the EU default, with the UK using a sliding scale of £40, £70, or £100 depending on the invoice size. This is separate from, and in addition to, any actual legal or debt-collection costs a creditor can otherwise recover. A contractual interest rate can always be agreed instead of the statutory one, but only if it's higher — a lower contractual rate is unenforceable against the statutory floor.
For example, a Czech creditor (CZ) currently charges 11.75% annually on an overdue invoice; a German creditor (DE) charges 10.52%; a UK creditor (GB) charges the Bank of England base rate plus 8 points. Enter your invoice details above to calculate the exact amount owed, including a full period-by-period breakdown if the statutory rate changed while the invoice was overdue.
For a quick check with fewer inputs — just amount, due date, and country — try the Overdue Invoice Interest Calculator, which assumes a business debtor and today as the payment date.
Frequently asked questions
- When does late-payment interest apply?
- It applies to overdue B2B (and public-authority) commercial invoices once the contractual due date has passed. If the contract sets no due date, EU Directive 2011/7/EU defaults to 30 days after the invoice (or goods/services, if later) for business debtors, and often 30 days for public authorities too — check the specific national implementation for your jurisdiction.
- What is the fixed recovery compensation?
- A flat minimum sum — €40 under the EU Directive, £40/£70/£100 under the UK LPCD Act depending on invoice size — that a creditor can claim per overdue invoice on top of interest, to cover the cost of recovering the debt, without having to prove actual recovery costs.
- Can I charge more than the statutory rate?
- Yes — if a higher rate is agreed in the contract, that contractual rate applies instead. A lower contractual rate is ignored: the statutory rate is a floor, not a ceiling that a weaker contractual term can undercut.
- Does this cover all countries?
- It covers all 27 EU member states and the UK. Enter the creditor's country — the statutory rate is determined by the creditor's jurisdiction, not the debtor's.
- Is this legal advice?
- No. This tool calculates the statutory amounts based on published rates. Consult a lawyer for complex cases, disputed debts, or cross-border enforcement.
- What is the current UK late payment interest rate?
- The UK statutory late payment rate is the Bank of England base rate plus 8 percentage points. Because the Bank of England base rate changes whenever the Monetary Policy Committee votes to move it, the effective rate changes with it — unlike EU rates which are reviewed on fixed January and July dates. The current base rate is shown on the Benchmark Rates page; the calculator always uses the most up-to-date rate.
- How is interest calculated when the rate changes mid-period?
- The calculator splits the overdue period into segments — one for each rate that applied during that window — and calculates interest separately for each segment. The period breakdown table shows each segment's date range, applicable rate, number of days, and interest amount. The total is the sum of all segments.
- What is the difference between the EU and UK recovery compensation amounts?
- Under EU Directive 2011/7/EU the fixed recovery compensation is €40 per overdue invoice, regardless of size, in most member states. The UK uses a sliding scale under the Late Payment of Commercial Debts Act: £40 for invoices under £1,000, £70 for invoices between £1,000 and £10,000, and £100 for invoices over £10,000. This is a per-invoice amount, not a percentage.
- Does the 30-day default payment term apply automatically?
- For B2B transactions, if the contract sets no payment term, the EU Directive and UK Act both default to 30 days from the later of (a) invoice date or (b) date goods or services were received. Public authorities face the same 30-day default but some member states apply stricter rules — the UK, for instance, targets 30 days for central government payments. Enter your specific due date above for an accurate calculation.
- Can I claim late payment interest on a disputed invoice?
- Strictly, statutory interest only runs on undisputed amounts. If part of an invoice is genuinely in dispute, interest typically accrues only on the undisputed portion. Once a dispute is resolved and a specific sum is agreed or adjudicated, interest runs from the original due date on that settled amount. Consult a solicitor or debt-recovery specialist for contested debts.