They are late. You are owed interest. Here is exactly how much.
Updated 13/10/2026
Base rate used: 3.75% (checked 13/10/2026 on the Bank of England website) — the reference rate for 1 January to 31 December 2026. Statutory rate 11.75%. Business-to-business invoices only.
Under the Late Payment of Commercial Debts (Interest) Act 1998, you can charge interest on overdue invoices to other businesses at 8% above the Bank of England base rate. The base rate used is the "reference rate": the rate on 30 June for debts falling due between July and December, and on 31 December for January to June. Bank Rate has been 3.75% since 18/12/2025, so the statutory rate for 1 January to 31 December 2026 is 11.75% a year. It applies automatically to business-to-business contracts in the UK unless you agreed a different, substantial remedy — you do not need it in your terms, though it helps to remind customers.
Interest = amount owed × (base rate + 8%) ÷ 365 × days overdue. For example, a £1,000 invoice that is 30 days overdue at 11.75%: £1,000 × 0.1175 ÷ 365 × 30 = £9.66 in interest, or about 32p a day. The interest runs daily from the day after the agreed payment date (or, if no date was agreed, 30 days after the later of the work being done and the invoice arriving) until the day you are paid.
In addition to interest, you can claim a fixed compensation amount: £40 for debts up to £999.99, £70 for debts between £1,000 and £9,999.99, and £100 for debts of £10,000 or more. This is a one-off payment per invoice, not per day. You can claim this even if you do not charge the interest.
GraftG Pro (£24/month) sends automatic email reminders in your name: friendly at 1 day overdue, polite at 7, firm at 14, and a final reminder at 21 days. Only customers you mark as a business get the final notice that cites the Act. Reply OUTSTANDING on WhatsApp to see exactly who owes you what. The chasing stops the moment the invoice is marked paid.
| Amount owed | Fixed compensation |
|---|---|
| Up to £999.99 | £40 |
| £1,000 to £9,999.99 | £70 |
| £10,000 or more | £100 |
Source: GOV.UK — late commercial payments, checked 13/10/2026. If your reasonable recovery costs are higher than the fixed sum, you can claim the difference. This is a guide, not legal advice.
11.75% a year: the Bank of England base rate of 3.75% plus 8%. The base rate used is the one in force on 31 December (for January to June) or 30 June (for July to December), and it was 3.75% on both dates.
Multiply the amount owed by the annual rate, divide by 365 to get the daily interest, then multiply by the number of days it is overdue. If the customer pays part of it, work out the interest on the reduced balance from the date of the part-payment.
No. The Late Payment of Commercial Debts (Interest) Act only covers business-to-business debts. For householders you can only charge interest if it was in the contract they agreed to before the work started.
No — for business customers the right to statutory interest and compensation applies automatically. Mentioning it on your invoices and in your final reminder makes it much more likely to be paid.
Related
🧮 Free calculators
Products
Your tools, one WhatsApp number. Solo from £14/month (intro price) — a 14-day free trial.