Late Payment Interest Rates by Country
What the law lets you charge when a business client pays an invoice late: the statutory rate, the fixed compensation and the default payment term in 15 jurisdictions, each read from the official statute or government page linked in the row.
Verified September 15, 2026 · Rates that reset each half-year are shown for July–December 2026 · Download as CSV
Quick answer
In the UK, Ireland and the rest of the EU, a supplier has a statutory right to interest on a late business invoice, currently about 10.4% a year in the euro area (ECB rate + 8 points) and 8% over base rate in the UK, plus a fixed recovery sum of at least €40 or £40. In the US, Canada and Australia there is no statutory right: you can charge only what the client agreed to in advance, and Canada, Mexico and the Philippines fall back to a low default (5–6%) when nothing was agreed.
The table
| Country | Statutory right? | Rate when nothing else is agreed | Fixed compensation | Default payment term | Source |
|---|---|---|---|---|---|
| United Kingdom | Yes | 8% above the Bank of England base rate | £40 (debt under £1,000), £70 (£1,000-£9,999.99), £100 (£10,000+) | 30 days after the invoice or delivery, whichever is later | Official source |
| European Union (directive minimum) | Yes | ECB reference rate plus at least 8 percentage points | Fixed sum of at least €40 per late invoice | 30 days after the invoice if no date is fixed; contractual terms beyond 60 days only if expressly agreed and not grossly unfair; 30 days for public authorities | Official source |
| Ireland | Yes | 10.4% per year from 1 July 2026 (ECB main refinancing rate 2.40% + 8 points) | €40 minimum, automatically, on an invoice under €1,000 | 30 days from receipt of the invoice unless the contract says otherwise | Official source |
| Germany | Yes | 9 percentage points above the Basiszinssatz between businesses (5 points for consumers) | €40 flat sum (Pauschale) | 30 days after the invoice is due and received, if no date was agreed | Official source |
| France | Yes | At least 3 times the taux d'intérêt légal; if the terms name no rate, the ECB refinancing rate plus 10 points | €40 indemnité forfaitaire per unpaid invoice | 30 days after delivery or performance; contractual maximum 60 days from the invoice or 45 days end of month | Official source |
| Netherlands | Yes | 10.4% per year from 1 July 2026 (wettelijke handelsrente) | €40 minimum collection costs, up to a maximum of €6,775 | 60 days between businesses; large companies must pay SMEs and freelancers within 30 days | Official source |
| Spain | Yes | 10.40% per year for the second half of 2026 (ECB rate 2.40% + 8 points) | €40 fixed sum (directive minimum, transposed in Ley 3/2004) | 30 days from receipt of goods or services; contractual maximum 60 days | Official source |
| Italy | Yes | 10.40% per year for the second half of 2026 (reference rate 2.40% + 8 points) | €40 flat sum, owed without proof of loss | 30 days from receipt of the invoice; contractual maximum 60 days | Official source |
| United States | Federal contracts only | None for private contracts; the rate in the contract applies, subject to state usury limits. Federal agencies: 4.75% (1 July - 31 December 2026) under the Prompt Payment Act | None by statute | None by statute for private contracts; federal agencies pay within 30 days of a proper invoice | Official source |
| Canada | Default rate only | 5% per year when no rate is agreed (Interest Act s. 3); a rate stated as monthly or daily without its annual equivalent is capped at 5% (s. 4) | None by statute | None by statute; the contract governs | Official source |
| Australia | No | None; only the rate specified in the contract | None by statute | None by statute; the contract or terms of trade govern | Official source |
| India | Yes, for micro and small suppliers | 3 times the Reserve Bank of India bank rate, compounded monthly | None by statute | 45 days from acceptance of the goods or services at most; 15 days if no term is agreed | Official source |
| Mexico | Default rate only | The agreed rate, or 6% per year when none was agreed (interés legal mercantil) | None by statute | None by statute; the contract governs | Official source |
| Brazil | Default rate only | When no rate is agreed, the legal rate: the Selic rate minus the IPCA monetary-correction index | None by statute | None by statute; the contract governs | Official source |
| Philippines | Default rate only | 6% per year when no rate is agreed (legal interest) | None by statute | None by statute; the contract governs | Official source |
Business-to-business transactions only. Consumer rules differ everywhere. This is a reference compiled from official sources, not legal advice; check the linked statute before relying on a figure in a dispute.
How to use this on an invoice
Whatever the law gives you, the practical rule is the same in every country on this list: state the late-payment terms before the first invoice. In the UK and EU the statutory rate applies even if you say nothing, but a client who has agreed to a clear clause pays faster than one who has to be told about a statute. Everywhere else the clause is the only right you have.
A clause that works across borders names three things: the rate as an annual figure with its monthly equivalent ("interest on overdue amounts at 12% per year, 1% per month"), the fixed recovery sum where the law provides one, and the day interest starts (the day after the due date). Canada's Interest Act is the reason for the annual figure: a rate stated only per month is capped at 5% a year. France goes further and fines a supplier whose invoice omits the penalty rate and the €40 indemnity.
Then use the late fee calculator to see what a given rate produces on a given invoice, and the guide to late fees for the rates freelancers commonly charge in practice, which are usually lower than the statutory maximums here. For invoicing clients abroad, see how to invoice international clients.
Country by country
United Kingdom · Europe
- Statutory right
- Yes
- Rate
- 8% above the Bank of England base rate
- Compensation
- £40 (debt under £1,000), £70 (£1,000-£9,999.99), £100 (£10,000+)
- Default term
- 30 days after the invoice or delivery, whichever is later
- Law
- Late Payment of Commercial Debts (Interest) Act 1998
- Source
- GOV.UK, Late commercial payments
The statutory right applies to business-to-business contracts and cannot be excluded unless the contract has its own substantial remedy. The base rate is fixed at 31 December or 30 June for the following six months.
European Union (directive minimum) · Europe
- Statutory right
- Yes
- Rate
- ECB reference rate plus at least 8 percentage points
- Compensation
- Fixed sum of at least €40 per late invoice
- Default term
- 30 days after the invoice if no date is fixed; contractual terms beyond 60 days only if expressly agreed and not grossly unfair; 30 days for public authorities
- Law
- Directive 2011/7/EU on combating late payment in commercial transactions
- Source
- EUR-Lex, Directive 2011/7/EU
Each member state transposes the directive into national law and may set a higher rate or shorter terms; the national rows below give the figures actually in force.
Ireland · Europe
- Statutory right
- Yes
- Rate
- 10.4% per year from 1 July 2026 (ECB main refinancing rate 2.40% + 8 points)
- Compensation
- €40 minimum, automatically, on an invoice under €1,000
- Default term
- 30 days from receipt of the invoice unless the contract says otherwise
- Law
- European Communities (Late Payment in Commercial Transactions) Regulations 2012, S.I. 580 of 2012
- Source
- Department of Enterprise, Late payment interest rate
The rate is reset every 1 January and 1 July from the ECB rate on that date. The daily rate is the annual rate divided by 365.
Germany · Europe
- Statutory right
- Yes
- Rate
- 9 percentage points above the Basiszinssatz between businesses (5 points for consumers)
- Compensation
- €40 flat sum (Pauschale)
- Default term
- 30 days after the invoice is due and received, if no date was agreed
- Law
- § 288 BGB (Bürgerliches Gesetzbuch)
- Source
- Gesetze im Internet, § 288 BGB
The Basiszinssatz is published by the Bundesbank each 1 January and 1 July. Compensation and interest are owed without a reminder once the payment date passes.
France · Europe
- Statutory right
- Yes
- Rate
- At least 3 times the taux d'intérêt légal; if the terms name no rate, the ECB refinancing rate plus 10 points
- Compensation
- €40 indemnité forfaitaire per unpaid invoice
- Default term
- 30 days after delivery or performance; contractual maximum 60 days from the invoice or 45 days end of month
- Law
- Code de commerce, articles L441-10 and D441-5
- Source
- Service-Public.fr, Pénalités de retard
The penalty rate and the €40 indemnity must be printed on the invoice and in the general terms of sale; a missing mention is itself a fine.
Netherlands · Europe
- Statutory right
- Yes
- Rate
- 10.4% per year from 1 July 2026 (wettelijke handelsrente)
- Compensation
- €40 minimum collection costs, up to a maximum of €6,775
- Default term
- 60 days between businesses; large companies must pay SMEs and freelancers within 30 days
- Law
- Burgerlijk Wetboek, article 6:119a
- Source
- Rijksoverheid, Hoogte wettelijke rente
The commercial rate applies to business-to-business and business-to-government transactions; the consumer rate (4% from 1 January 2026) is separate. Payment terms and collection costs: business.gov.nl.
Spain · Europe
- Statutory right
- Yes
- Rate
- 10.40% per year for the second half of 2026 (ECB rate 2.40% + 8 points)
- Compensation
- €40 fixed sum (directive minimum, transposed in Ley 3/2004)
- Default term
- 30 days from receipt of goods or services; contractual maximum 60 days
- Law
- Ley 3/2004, de 29 de diciembre, artículo 7
- Source
- BOE, Resolución de 30 de junio de 2026 (BOE-A-2026-14327)
The Tesoro publishes the rate each semester in the BOE; the first half of 2026 was 10.15%.
Italy · Europe
- Statutory right
- Yes
- Rate
- 10.40% per year for the second half of 2026 (reference rate 2.40% + 8 points)
- Compensation
- €40 flat sum, owed without proof of loss
- Default term
- 30 days from receipt of the invoice; contractual maximum 60 days
- Law
- D.Lgs. 231/2002 (as amended by D.Lgs. 192/2012)
- Source
- Gazzetta Ufficiale n. 163 of 16 July 2026, MEF communiqué
The Ministry of Economy publishes the reference rate each semester; the first half of 2026 was 10.15%.
United States · North America
- Statutory right
- Federal contracts only
- Rate
- None for private contracts; the rate in the contract applies, subject to state usury limits. Federal agencies: 4.75% (1 July - 31 December 2026) under the Prompt Payment Act
- Compensation
- None by statute
- Default term
- None by statute for private contracts; federal agencies pay within 30 days of a proper invoice
- Law
- Prompt Payment Act, 31 U.S.C. § 3901 et seq. (federal payments); state law otherwise
- Source
- U.S. Treasury Fiscal Service, Prompt Payment
A late fee on a private invoice is enforceable only if the client agreed to it beforehand, and some states cap the rate a business may charge. See the late-fee guide for the rates freelancers commonly use.
Canada · North America
- Statutory right
- Default rate only
- Rate
- 5% per year when no rate is agreed (Interest Act s. 3); a rate stated as monthly or daily without its annual equivalent is capped at 5% (s. 4)
- Compensation
- None by statute
- Default term
- None by statute; the contract governs
- Law
- Interest Act, R.S.C. 1985, c. I-15
- Source
- Justice Laws Website, Interest Act
To charge more than 5%, state the annual rate on the invoice and in the contract, for example 'interest at 18% per year (1.5% per month)'.
Australia · Asia-Pacific
- Statutory right
- No
- Rate
- None; only the rate specified in the contract
- Compensation
- None by statute
- Default term
- None by statute; the contract or terms of trade govern
- Law
- Contract law; state and territory legislation for court-ordered interest
- Source
- business.gov.au, Write a letter of demand
The federal guidance is explicit: include a late payment interest rate in a demand only if it was specified in the contract. Put the rate in your terms of trade before the first invoice.
India · Asia-Pacific
- Statutory right
- Yes, for micro and small suppliers
- Rate
- 3 times the Reserve Bank of India bank rate, compounded monthly
- Compensation
- None by statute
- Default term
- 45 days from acceptance of the goods or services at most; 15 days if no term is agreed
- Law
- Micro, Small and Medium Enterprises Development Act 2006, sections 15-16
- Source
- MSME Samadhaan, MSMED Act 2006
Applies when the supplier is a registered micro or small enterprise. Claims go to the state Micro and Small Enterprise Facilitation Council through the Samadhaan portal.
Mexico · Latin America
- Statutory right
- Default rate only
- Rate
- The agreed rate, or 6% per year when none was agreed (interés legal mercantil)
- Compensation
- None by statute
- Default term
- None by statute; the contract governs
- Law
- Código de Comercio, artículo 362
- Source
- Cámara de Diputados, Código de Comercio
Interest runs from the day after the due date. State the rate on the invoice and contract; the 6% default is low by design.
Brazil · Latin America
- Statutory right
- Default rate only
- Rate
- When no rate is agreed, the legal rate: the Selic rate minus the IPCA monetary-correction index
- Compensation
- None by statute
- Default term
- None by statute; the contract governs
- Law
- Código Civil, artigo 406, as amended by Lei 14.905/2024
- Source
- Planalto, Lei 14.905/2024
The Central Bank publishes the method for the legal rate. Contractual late-payment fines are common but are capped separately in consumer contracts.
Philippines · Asia-Pacific
- Statutory right
- Default rate only
- Rate
- 6% per year when no rate is agreed (legal interest)
- Compensation
- None by statute
- Default term
- None by statute; the contract governs
- Law
- BSP Manual of Regulations for Banks, section 305 (Circular 799, series of 2013)
- Source
- Bangko Sentral ng Pilipinas, MORB section 305
The 6% rate is the one courts apply to unpaid sums absent an agreed rate; a higher contractual rate must be in writing.
How this table was compiled
Each row was read from the primary source linked in it: the statute on the government's own legislation site, or the government page that publishes the current rate. Rates that reset every six months (Ireland, Spain, Italy, the Netherlands, the US Prompt Payment rate) are the ones in force for July to December 2026 and are re-checked at each reset. Jurisdictions where we could not find an official source for the current figure are left out rather than estimated; South Africa, Singapore, New Zealand and the UAE are missing for that reason and will be added when sourced.
The whole table is available as a CSV file with a verification date on every row. You are welcome to quote or republish it with a link to this page.
Frequently Asked Questions
Can I charge interest on a late invoice?
In the UK, the EU and Ireland, yes by law: a supplier is entitled to statutory interest and a fixed recovery-cost sum the moment a business customer pays late, whether or not the contract mentions it. In the US, Canada, Australia and most other countries the right comes from the contract, so the rate has to be agreed before the invoice is issued. Some countries then supply a default rate when the contract is silent: 5% in Canada, 6% in Mexico and the Philippines.
What is the statutory late payment interest rate in the UK?
8% plus the Bank of England base rate, under the Late Payment of Commercial Debts (Interest) Act 1998, for business-to-business debts. You can also add a fixed sum of £40, £70 or £100 depending on the size of the debt. The base rate used is the one in force on 31 December or 30 June for the following six months.
What is the late payment rate in the EU?
Directive 2011/7/EU sets a floor of the ECB reference rate plus 8 percentage points and a fixed €40 recovery sum. For the second half of 2026 that works out at 10.4% in Ireland, Spain, Italy and the Netherlands; Germany applies 9 points above its own Basiszinssatz, and France requires at least three times the legal rate. Payment terms between businesses default to 30 to 60 days.
Is there a statutory late fee in the United States?
Not for private invoices. A late fee is enforceable only if the client agreed to it in advance, and state usury laws cap what a business may charge. The Prompt Payment Act covers federal agencies only: they must pay a proper invoice within 30 days, after which interest runs at the Treasury rate, 4.75% for 1 July to 31 December 2026.
Which rate applies when I invoice a client in another country?
The law that governs the contract, which is usually the one the contract names and otherwise often the seller's. If the contract is silent, expect the client's local rules to be argued. The safe practice for international work is to state the late-payment rate, the currency and the governing law on the invoice and in the agreement, so no default rate has to be inferred.
What is the fixed compensation for late payment?
A flat sum the law adds on top of interest to cover recovery costs, owed without proof of expense. It is £40 to £100 per invoice in the UK depending on the amount, and at least €40 per invoice across the EU (Ireland, Germany, France, Spain, Italy and the Netherlands all apply €40; the Netherlands scales it up to €6,775 on large debts). No such sum exists by statute in the US, Canada or Australia.
Put the terms on the invoice itself
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