How the calculation works
- Formula
- Bank of England base rate + 8 percentage points, pro-rated by late days.
- Current stored rate
- 3.75% source rate effective 2025-12-18; current stored formula rate 11.75%.
- Recovery compensation
- Fixed recovery costs are tiered by debt size: GBP 40, GBP 70, or GBP 100.
- Primary source
- Late Payment of Commercial Debts (Interest) Act 1998
For a GBP commercial debt, the calculator applies BoE base + 8 percentage points and selects the statutory recovery-cost tier from the debt amount.
This tool calculates interest mechanically from stored rate data. It is not legal advice. Always check the contract, governing law, debtor status, and any sector-specific rules.
Frequently asked questions
What UK rate does the calculator use?
It uses the Bank of England base rate plus 8 percentage points for statutory commercial late-payment interest.
How are UK recovery costs calculated?
The fixed amount depends on the debt size: GBP 40, GBP 70, or GBP 100.
Is this for consumer debts?
No. The UK statutory calculator is aimed at commercial debts, not consumer credit or consumer invoices.