Step 1: Confirm the debt is overdue
Start with the invoice due date and the payment terms agreed with the customer. Interest should only be calculated after the invoice is overdue.
If there is a genuine dispute over the goods, services, or invoice amount, resolve that issue before relying on a statutory interest calculation.
Step 2: Calculate interest and compensation
Use the calculator to estimate the number of overdue days, the daily interest amount, accrued interest, fixed compensation, and total claim.
The fixed compensation tier depends on the invoice amount: 40 GBP below 1,000 GBP, 70 GBP from 1,000 GBP to 9,999.99 GBP, and 100 GBP from 10,000 GBP upward.
Step 3: Send a professional demand
A clear demand should include the original invoice amount, invoice number, due date, days overdue, interest calculation, compensation amount, and total requested payment.
Avoid vague language. A specific claim value is easier for the debtor to understand and harder to ignore.
FAQ
Common questions
Do I need a solicitor to claim late payment interest?
Not always. Many businesses start with a formal payment reminder. A solicitor may be useful for disputed, high-value, or court-stage claims.
Can I add compensation as well as interest?
For qualifying commercial debts, fixed statutory compensation may be added alongside statutory interest. The amount depends on the invoice value.