Late Payment Interest Calculator UK: 8% + Base Rate
Calculate the statutory interest and fixed compensation you're entitled to for overdue B2B invoices under UK law.
Fact-checked against GOV.UK and Bank of England sources on 14 July 2026
Quick Answer
Enter the overdue invoice amount, due date, and current Bank of England base rate to calculate statutory late payment interest for a UK B2B debt.
If you are preparing to escalate, keep the result with your chasing letters and MCOL evidence.
The calculator adds interest at 8% plus the base rate and the fixed compensation amount you can claim: £40, £70, or £100 depending on the invoice value.
Late Payment Interest Calculator
Calculate statutory interest & compensation for overdue invoices
The 3.75% reference rate applies from 1 July to 31 December 2026. Change this for a debt that became late in another six-month period.
How Late Payment Interest Works in the UK
Under the Late Payment of Commercial Debts (Interest) Act 1998, UK businesses have a statutory right to charge interest on overdue invoices for business-to-business (B2B) transactions.
Statutory Interest Rate
The statutory interest rate is 8% per annum above the Bank of England base rate. This interest accrues daily from the day after the payment due date.
Fixed Compensation
In addition to interest, you can claim a fixed sum as compensation for debt recovery costs:
Proposed 2026 Late Payment Reforms
The Commercial Payments Bill was introduced to Parliament in May 2026. Proposed measures include maximum payment terms, mandatory interest on late payments, stronger reporting requirements and new enforcement powers for the Small Business Commissioner.
These changes are not yet in force. The government says businesses will receive a lead-in period and the measures will not apply retrospectively.
Automate Late Payment Interest
Experi estimates late-payment interest and compensation for an eligible B2B debt. Check the contract and applicable reference period before adding any charge.
Frequently Asked Questions
What is the statutory interest rate for late payment in the UK?
The statutory interest rate for late commercial payments is 8% above the applicable Bank of England reference rate. The 3.75% rate on 30 June 2026 applies from 1 July to 31 December 2026, giving an annual statutory rate of 11.75% for that period.
How much fixed compensation can I claim for a late payment?
For an eligible late commercial payment, fixed compensation is £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.
When does an invoice become overdue?
An invoice becomes overdue the day after the agreed payment terms expire. If no terms are specified, the default payment period is 30 days from either the delivery of the invoice or the delivery of the goods/services, whichever is later.
Can I add late payment interest to an MCOL claim?
For an eligible business-to-business unpaid invoice, statutory interest and fixed compensation can be part of the amount owed. Keep a copy of the invoice, payment terms, reminder emails, and the calculation so you can show how the claim amount was worked out.
What is the 2026 Late Payment Reform?
The Commercial Payments Bill was introduced to Parliament in May 2026, but its measures are not yet in force. The Bill proposes maximum payment terms, mandatory interest, stronger reporting and enforcement powers, with a transition period before commencement.