Free tool
Late fee & interest calculator for unpaid invoices
Estimate a flat late fee, a monthly late charge or simple annual interest on a past-due invoice. Use it only for charges your contract or terms actually allow.
How the math works
- Monthly percentage: amount × monthly rate × (days past due ÷ 30). For example, 1.5% per month on $5,000 for 60 days ≈ $150.
- Simple annual interest: amount × APR × (days ÷ 365), with no compounding.
- Flat fee: a fixed charge per late invoice, if your terms specify one.
Can I charge a late fee?
Generally only if the customer agreed to it, for example in signed terms, a credit application or the contract, and only within legal limits. Some states cap interest rates or late fees, consumer and residential-lease charges are often restricted more tightly, and a charge that wasn't agreed to may not be collectible and can create liability. Where no rate was agreed, some states let creditors seek statutory or prejudgment interest through the courts, at a rate set by law. When in doubt, ask an attorney.
Next steps: send a final notice or a demand letter, or get matched with a collection partner.
Not legal advice. This page is general information, not legal advice, and laws vary by state and change over time. CollectionPlacement is a referral service, not a law firm or collection agency. Consult a licensed attorney about your situation.
Frequently asked questions
How do I calculate a late fee on an invoice?
Apply the rate in your terms. For a monthly rate, multiply the invoice amount by the rate and by the number of months late. For an annual rate, multiply by the rate and days late ÷ 365.
What is a typical late fee for invoices?
Terms vary. Many businesses use a monthly percentage or a flat fee, but the allowed amount depends on your agreement and state law.
Can I add a late fee if it wasn't in my contract?
Often not. Late fees generally need a contractual basis, although courts may award statutory interest in some cases.
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