Late-Payment Interest in the EU & UK: What You're Owed on Overdue Invoices

How much late-payment interest you can charge on an overdue B2B invoice in the EU and UK — the statutory rates, the fixed recovery fee, a worked calculation, and how to actually claim it.

Hugo Lefèvre11 June 20266 min read

Short answer: on overdue B2B invoices you're entitled to statutory late-payment interest — in the EU, at least 8 points above the ECB reference rate plus a €40 fixed recovery fee; in the UK, 8% above the Bank of England base rate plus £40–£100 plus reasonable recovery costs. It applies automatically, even if your contract is silent.

General information for freelancers and small businesses, not legal or financial advice. Reference rates change — confirm the current figure before you invoice interest.

EU vs UK at a glance

	EU (B2B)	UK (B2B)
Legal basis	Late Payment Directive 2011/7/EU	Late Payment of Commercial Debts (Interest) Act 1998
Interest rate	≥ 8 pts above the ECB reference rate	8% above the Bank of England base rate
Fixed recovery fee	€40 per invoice	£40 / £70 / £100 by invoice size
Extra recovery costs	Reasonable costs above the €40	Reasonable costs above the fixed sum
When it starts	Day after the agreed term (default 30 days)	Day after the agreed term (default 30 days)

National rules transpose the EU directive with small differences (some countries set a higher margin), so check your own jurisdiction for the exact figure.

A worked example

Say a German client owes you €4,500, the ECB reference rate is 3% (making the statutory rate 11%), and the invoice is 30 days overdue:

Interest: €4,500 × 11% × (30 ÷ 365) ≈ €40.68
Fixed recovery fee: €40.00
Total on top of the invoice: ≈ €80.68

The interest is modest on a single invoice — its real value is as a signal. It tells the client's accounts payable team that late payment has a cost and that you know your rights, which on its own often moves you up the payment queue.

How to actually claim it

State it on the invoice. A line such as “Late payments accrue statutory interest per Directive 2011/7/EU” sets the expectation up front.
Apply it at the final demand. Don't bolt interest onto a 7-day reminder — introduce it when you send the final demand, with the calculated figure.
Reissue a clean invoice showing the original amount, the interest, the recovery fee, and the new total — so the client has one unambiguous number to pay.

FAQ

How much interest can I charge on a late invoice?

For B2B invoices in the EU, statutory interest is at least 8 percentage points above the ECB reference rate, plus a fixed €40 recovery fee per invoice. In the UK it's 8% above the Bank of England base rate, plus a fixed sum of £40–£100 depending on the invoice size, plus reasonable recovery costs. The exact rate moves with the central-bank reference rate, so check the current figure.

Do I have to charge late-payment interest?

No — it's a right, not an obligation. You're entitled to it automatically on overdue B2B payments even if it isn't written in the contract, but you can choose to waive it for a good client. Many freelancers state the entitlement on the invoice as a deterrent and only actually apply it at the final-demand stage.

How do I calculate late-payment interest?

Interest = unpaid amount × (reference rate + 8%) × (days overdue ÷ 365), then add the fixed recovery fee. Example: €4,500 unpaid, a 3% reference rate (so 11% total), 30 days overdue = €4,500 × 11% × 30/365 ≈ €40.68 interest, plus the €40 fee ≈ €80.68. Use the reference rate in force on the day the invoice became overdue.