Freelance Finance
Late Payment Interest Calculator
Enter an invoice amount, due date, payment or calculation date, annual rate, grace period, and optional fee to find interest owed and the total amount due.
Total late-payment charge
£6.99
30 chargeable overdue days.
- Invoice amount
- £1,000.00
- Daily interest amount
- £0.23
- Interest accrued
- £6.99
- Fixed recovery fee
- £0.00
- Total amount due
- £1,006.99
- Overdue days
- 30
- Grace period
- 0
How to use this calculator
Enter the invoice amount, due date, payment or calculation date, annual interest rate, grace period, optional fee, and compounding method. If payment is early, on time, or still inside the grace period, interest is zero.
Methodology
The calculator counts calendar days from the due date to the payment or calculation date, subtracts any grace period, then applies simple or daily-compounded interest.
Formula
rate_decimal = annual_interest_rate / 100
simple_interest = principal * rate_decimal * chargeable_overdue_days / 365
daily_compound = principal * ((1 + rate_decimal / 365) ^ chargeable_overdue_days - 1)Example
A £1,000 invoice at 8.5% annual interest that is 30 days overdue produces £6.99 of simple interest before any fixed recovery fee.
Important considerations
Contracts can replace statutory defaults, consumer debts may be treated differently, and public authority rules can differ. Keep evidence of payment terms and due dates.
FAQs
Can I charge late-payment interest?
That depends on your contract, client type, jurisdiction, and applicable law. Get legal advice before adding charges to an invoice.
How are overdue days calculated?
The calculator counts calendar days after the due date, then subtracts the grace period to find chargeable overdue days.
What is the difference between simple and daily-compounded interest?
Simple interest applies the annual rate to the original invoice amount, while daily compounding adds each day of interest to the balance.
Should I include a fixed recovery fee?
Only include a fee supported by your contract or applicable rules. The calculator does not determine whether a fee is enforceable.
Does this handle leap years?
Date differences use actual calendar days, while both interest formulas use a 365-day annual denominator.
Can I use this result for legal enforcement?
Use it only as arithmetic support. Ask a qualified professional before claiming interest or fees.
Disclaimer
This calculator does not provide legal advice and does not confirm that a late-payment charge is enforceable.