Interest on Late Payments

All businesses have a legal right to claim interest from late-paying customers.

The statutory right to interest, introduced under the Late Payment of Commercial Debts (Interest) Act 1998, applies to all contracts agreed after 7 August 2002. Late payments create cashflow problems and expose businesses to the risk that they will not be paid.

This briefing covers:

• Who can charge interest on late payments.
• How to decide whether or not to claim statutory interest.
• How to calculate how much interest to charge.
• How to claim what you are entitled to.