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What you can claim extra - Statutory late payment compensation and interest

Under The Late Payment of Commercial Debts Interest Act 1998

 

For Business to Business debts (B2B) you can claim extra amounts on top of your overdue invoice total. A business to business debt does not, as some think, have to be between bone fidi Limited companies. It can be between two sole traders, or a sole trader owing money to a  LTD company or any combination.

 

It does not apply to consumer (members of the public) debts. So if for example you carried out some gardening work at a persons house and they did not pay the invoice you cannot charge statutory compensation or statutory interest. If however you carried out the gardening work at the persons office you could.

 

Statutory compensation

 

This is designed to compensate you for your debt collection costs. Unfortunately the tariff was last updated over 10 years ago so the compensation received is often inadequate. We add statutory compensation and interest to your debt automatically. It is calculated on a per invoice basis, so if you had a £999 debt made up from 1 invoice you would be entitled to one payment of statutory compensation ie £40, if the same debt was made up from 3 overdue invoices you are entitled to 3 x £40 = £120 extra. Statutory compensation is calculated as follows:

Invoice Amount

Statutory compensation per invoice

Up to £999.99p

£40

£1000.00 - £9,999.99p

£70

£10,000 or more

£100

Statutory interest

 

You are entitled to charge - again we calculate it for you automatically - statutory interest. This is calculated at 8% above the Bank of England base rate. A reference rate every 6 months is used to work out the interest as base rate fluctuates. Use the form below to see how much interest you are entitled to. Again its worked out on a per invoice basis. The date contract formed field is purely to check that the debt was incurred after the act came into force, so you don’t have to put an exact date in for this.

Late payment statutory interest calculator

CALCULATOR
Date the work was done approx  (dd/mm/yyyy)
Date payment became overdue  (dd/mm/yyyy)
Date of Payment (if principal debt has now been paid):  (dd/mm/yyyy)
Are you a public sector body? (tick for yes)
Number of approx employees (Creditor)  (numbers only)
Number of approx employees (Debtor)  (numbers only)
Total invoice value (inc VAT)  (numbers only)
 
CALCULATION RESULTS