Statutory Interest on Late Payments: Who Qualifies and What You Get
Learn how businesses can claim interest on unpaid invoices to protect their cash flow when customers pay late.
This scheme allows businesses to claim interest on money owed to them when a customer fails to pay an invoice by the agreed date.
Who it's for
This is for businesses that sell goods or services to other businesses.
What you get
If a business payment is late, you have a legal right to charge interest on the unpaid amount. The interest amount is calculated as a set percentage plus the current base rate set by the central bank.
What it costs you
There is no cost to use this scheme.
The catch to know
To ensure you can successfully claim this interest, you must clearly state your specific payment terms within your contract or agreement.
How to apply
- Review your contract to ensure your payment terms are clearly defined.
- Identify the invoices that have not been paid by the deadline.
- Contact the customer to request the overdue amount plus the calculated interest.
- Follow formal debt recovery processes if the customer refuses to pay.