IncomeChecker.com

Late Payment Interest Calculator

Calculate the interest owed on an overdue invoice. Enter the amount, the annual rate, and how many days it is late, and see the interest, the daily amount, and the new total.

$
%
Interest owed
$147.95
Per day
$2.47
New total
$5,147.95

The formula

  • Interest = amount × annual rate × days late ÷ 365
  • Interest per day = amount × annual rate ÷ 365

Example. A $5,000 invoice, 60 days late at 18% a year: $5,000 × 0.18 × 60 ÷ 365 = $147.95. That is $2.47 per day, so the new total is $5,147.95.

Things to check

  • This is simple interest, calculated on the original amount only. It does not compound.
  • The rate must come from your agreement or from the law. Many places set a legal maximum and a default rate when the contract is silent.
  • Some contracts use a 360-day year. If yours does, the answer is slightly higher; use the rate and the day-count your contract states.

Frequently asked questions

How do I calculate interest on a late invoice?

Multiply the amount by the annual rate, then by the days late, then divide by 365. For $5,000 at 18% for 60 days, that is $147.95.

What interest rate can I charge on late payments?

Use the rate in your contract. If there is none, the rule falls to state or national law, which varies. Some jurisdictions set a legal rate for business debts.

Is the interest compounding?

No. This tool calculates simple interest on the original amount. Compounding only applies if your agreement says so.

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Calculators give estimates from the numbers you enter. They are not tax, legal, or accounting advice.