Interest on late commercial payments
The interest you can charge if another business is late paying for goods or a service is 'statutory interest' - this is 8% plus the Bank of England base rate for business to business transactions. You can't claim statutory interest if there's a different rate of interest in a contract.
You can't use a lower interest rate if you have a contract with public authorities.
The current Bank of England base rate is 0.5%, so statutory interest for a recent debt would be 8.5%.
Check the Bank of England base rate history.
If your business were owed £1,000:
- the annual statutory interest on this would be £85 (1,000 x 0.085 = £85)
- divide £85 by 365 to get the daily interest: 23p a day (85 / 365 = £0.23)
- after 50 days this would be £11.50 (50 x 0.23 = £11.50)
Send a new invoice if you decide to add interest to the money you're owed.