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Late Payment Law UK
Claim interest on overdue invoices
This guide explains how to use the Late Payment of Commercial Debts (Interest) Act 1998 to charge interest where a customer is late in paying their invoices. Updated for recent changes to bank base rates in 2023.
✓
8% above base rate✓
Fixed compensation £40–£100✓
Go back up to 6 years8%+
Above Bank of England base rate
£40–£100
Fixed compensation per invoice
6 years
Retrospective claims allowed
Explore the guide
Everything you need to know about claiming late payment interest on commercial debts in the UK.
Introduction
Background to the Late Payment of Commercial Debts (Interest) Act 1998 and how it helps businesses.
→Commercial Debts
Which debts are covered by the legislation and which are not.
→Credit Period
Working out the credit period that applies to your contract.
→Interest Rate
How the rate of interest is calculated — 8% above Bank of England base rate.
→Compensation
Fixed compensation amounts you can claim on top of interest (£40–£100).
→Calculator
Work out exactly how much interest and compensation you can claim on overdue invoices.
→When to Use It
Different ways to use the late payment legislation — as a deterrent, threat, or in court.
→Court Claims
Adding late payment interest and compensation to a court claim, with standard wording.
→Further Resources
Links to the legislation, court service, and other useful resources.
→Ready to claim what you're owed?
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