Late payment fees compensate you for delayed payment and encourage prompt payment
This calculator shows how much to charge for overdue invoices based on the original amount, days overdue, and annual interest rate.
How to use this calculator
Enter the original invoice amount. Input how many days past the due date the invoice is. Set your annual interest rate — typically 10-24% depending on your contract and local laws. The calculator shows the late fee, total amount due, and daily fee rate.
How late payment fees are calculated
Late fees use simple daily interest. The annual rate is divided by 365 to get a daily rate, then multiplied by the invoice amount and days overdue.
Late Fee = Invoice Amount × (Annual Rate / 365) × Days OverdueFrequently asked questions
What late payment fee percentage is legal?
It varies by location. In the US, most states allow 10-18% without issues. Some states cap it at 10%, others allow up to 24%. EU countries typically allow 8-10%. Always check local laws and include your late fee terms in your contract or invoice terms.
Should I charge late fees to every client?
Apply them consistently according to your stated terms. Don't waive fees for late payers unless there's a legitimate exceptional circumstance. Selective enforcement undermines the policy. If a good long-term client asks for a one-time waiver, consider it — but make it clear it's an exception.
When should I start charging late fees?
After your payment terms expire. If you invoice Net 30, start charging on day 31. Some freelancers add a grace period (charge starting day 15 after due date) to maintain goodwill, but this should be stated in your terms.
How do I tell a client about a late fee?
Send a polite reminder email: "Invoice #1234 for $5000 was due on [date] and is now 30 days overdue. Per our contract terms, a late payment fee of $73.97 has been applied. The total due is now $5073.97. Please remit payment at your earliest convenience."
What if a client refuses to pay the late fee?
If the fee was clearly stated in your contract or invoice terms, you're entitled to it. For small amounts or valued long-term clients, you might waive it to preserve the relationship. For significant amounts or chronic late payers, stand firm or stop working with them.