Free Tool
Late Payment Calculator & Reminder Generator
Enter an invoice amount, how many days it's overdue, and your jurisdiction to estimate the interest owed — then get a ready-to-send, three-stage reminder sequence (friendly, firm, final notice) you can copy and email today.
The US has no single federal statutory interest rate for private B2B invoices — it depends on your state and what your contract or invoice terms say. 1.5%/month (18%/year) is a widely used default; check current rules for your state before invoicing it.
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Why the paper trail matters
On r/smallbusiness, a small remodeling business owner described chasing a $14,200 final invoice for two months — "polite emails, then less polite emails, then calls" — while stuck deciding whether legal action was worth the cost of chasing money already owed. In a separate thread, someone who took over billing for a family business found a customer sitting on nearly $200,000 in unpaid invoices going back years; the fix the community converged on was simple but blunt: move that account to pay-on-delivery until the balance was cleared.
Both stories point the same direction: a clear, documented, escalating sequence — sent early, not after months of silence — is what gives you a real paper trail if it ever needs to go further, and it's often what gets you paid before it does.
Frequently Asked Questions
How is the late payment interest on this calculator worked out?
Interest = invoice amount x (annual rate ÷ 100) x (days overdue ÷ 365). It's simple daily-accrual interest, which is how most statutory late-payment regimes and typical invoice terms calculate it. It's an estimate, not a legal calculation for a specific contract.
Is it actually legal to charge interest on a late invoice?
For B2B invoices, yes, generally — either because your invoice or contract terms say so (common in the US), or because a statutory right exists regardless of what your invoice says (the position in the UK and EU for qualifying commercial transactions). Consumer invoices are treated differently in most jurisdictions. This tool is not legal advice — confirm the specifics for your situation before invoicing someone for interest.
What is the UK statutory late payment interest rate?
The Bank of England base rate plus 8 percentage points, under the Late Payment of Commercial Debts (Interest) Act 1998. Because the base rate moves, check the current rate before relying on the exact number — the calculator's default is a placeholder, not today's confirmed rate.
What is the EU or Poland statutory late payment rate?
The EU Late Payment Directive (2011/7/EU) sets a minimum of a reference rate (the ECB rate, or in Poland the National Bank of Poland's reference rate) plus at least 8 percentage points for B2B transactions, alongside a minimum fixed compensation for recovery costs. As with the UK, verify the current reference rate for an exact figure.
Is there a federal late-payment interest rate in the US?
No single one for private commercial invoices. It comes down to your state's law and whatever your contract or invoice terms specify. 1.5% per month (18% annually) is a common default many small businesses use, but check your state and your own agreement before charging it.
When should I send the final notice instead of another friendly reminder?
Once you've sent a friendly nudge and a firmer follow-up with no payment and no explanation, it's reasonable to move to a final notice with a hard deadline. Real accounts of chasing five- and six-figure unpaid invoices show that dragging out the polite phase for months rarely changes the outcome — it just delays the decision you'll eventually have to make.
What if the final notice doesn't get me paid?
At that point most small business owners look at pausing further work, requiring upfront or COD payment on anything new, and — for larger balances — a demand letter, a mechanics lien (where applicable to your trade), small claims court, or a collections agency. This tool doesn't cover that process in detail and isn't legal advice; it's meant to help you document a clear, professional paper trail before you get there.
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