Free tool · Freelance payment laws
Late fee calculator, to the day.
Enter an unpaid invoice and your terms. See every fee they allow and when, what that is as a yearly rate, and a sentence for your contract and invoices, so your client knows the terms before the work starts.
Calculator
How a late fee is worked out
A late fee is a share of what's still unpaid, a flat amount, or both, added once or every 30 days after the due date, as your terms say. It's charged on the work, never on earlier fees.
- A monthly rate
- Unpaid amount × monthly rate, once for every 30 days late
- A yearly rate, by the day
- Unpaid amount × yearly rate × days late ÷ 365
- A flat fee
- The amount, once, when the invoice is as many days late as your terms say
Take a $2,400 invoice due September 18 on 1.5% a month, starting 5 days late. On October 28 it's 40 days overdue: $36 was added on September 23 and $36 more on October 23, $72 in all. That's about 18% a year. The same 18% counted by the day would be $2,400 × 18% × 40 ÷ 365 = $47.34.
What's a usual late fee?
Most terms are a monthly percentage, a flat fee, or a flat fee and then a percentage. BillGrid's ready-made terms are 1.5% a month (about 18% a year) up to 10% of the invoice, or a flat $25 five days late. Make it large enough to be worth asking for and small enough to read as a fair price for waiting: a court can refuse a fee that looks like a penalty, which is why this calculator warns you above 2% a month.
Can I add a late fee to an invoice that's already late?
Not one your client didn't agree to. A fee belongs in your contract, proposal or invoice before the invoice falls due. In the UK, Ireland and the rest of the EU you don't need one: the law gives you interest and a fixed sum on a late business invoice unless your contract sets its own (the table below). Everywhere else, put the sentence above on your next invoices, and the next late payer is covered.
Is a late fee legal?
Yes, if your client agreed to it and it's reasonable. In the US, no law sets a late fee on a business invoice: it's what you and your client agree, before the work, on the contract or the invoice. States limit interest in different ways, and a court can refuse a fee that looks like a penalty. Where your contract names no rate, a few states still allow interest on a late debt, such as California's 10% a year after a breach (Civil Code §3289) and Texas's 6% from the 30th day (Finance Code §302.002). For comparison, the US government pays its own late contractors 4.75% a year from July to December 2026 (Prompt Payment rate).
Where a freelance payment law applies, most of them let you claim up to twice what's unpaid, through a court or an agency; Columbus's law is enforced by the city instead. A late fee you agreed to is separate from either.
Late fees by country
The UK, Ireland and the EU give you interest on a late business invoice by law; the US, Canada and Australia leave it to your terms. Rates are for invoices that fell overdue from July to December 2026.
| Where your client is | Without a clause | With a clause |
|---|---|---|
| United Kingdom | 11.75% a year, 8% over the Bank of England's 3.75% reference rate, plus £40, £70 or £100 per invoice by its size (GOV.UK) | Your own terms, if they're a substantial remedy. Pick GBP above for the statutory terms |
| Ireland | 10.4% a year, plus €40, €70 or €100 per invoice by its size (Department of Enterprise) | Your own terms |
| Rest of the EU | At least 8 points over the ECB rate (2.40%) and at least €40 per invoice: 10.4% in the Netherlands, Spain and Italy, 10.52% in Germany, 12.40% in France (Directive 2011/7/EU) | Your own terms, if they aren't grossly unfair to you |
| United States | No late fee; in some states, interest on a late debt (above) | Your agreed fee, within your state's interest limits |
| Canada | None | Your terms. Write a monthly rate's yearly equivalent beside it, or the interest is limited to 5% a year (Interest Act, s.4) |
| Australia | None | The rate your contract specified (business.gov.au) |
The UK's Commercial Payments Bill, now in the House of Commons, would cap payment terms at 60 days and stop contracts opting out of statutory interest. The EU's proposed Late Payment Regulation is still pending. We'll update this table if either becomes law.
Questions
Is the fee charged on earlier fees?
Not here and not in BillGrid: each fee is a share of what's unpaid of the work itself, never of earlier fees.
Why does it stop?
At the cap, if your terms have one; the last fee is trimmed to fit. Without a cap, after a year overdue: by then it's a matter for small claims, not another fee.
Can I charge a flat fee and interest?
Yes, as two parts: a flat fee once, then a percentage every 30 days, like the "$25, then 1.5% a month" terms above. Keep the two together reasonable.
How do I send this to my client?
Print a statement or copy the link under the result. The link opens this exact answer, so your client can check the figures.
Sources
Every rate on this page comes from the law or the agency that sets it, read on . We check them again each January and July, when the reference rates change. This is general information, not legal advice.