WHITO GLOSSARY · MEASURED DEFINITIONS
The interest a UK business can already charge on late commercial invoices under the Late Payment of Commercial Debts (Interest) Act 1998: 8% above the Bank of England base rate. It has been there the whole time.
The number: Late Payment Interest You Can Already Charge.
What it means in practice
Most owners think charging interest needs a contract clause or a solicitor. It needs neither. The right exists in law for commercial debts, whether or not your paperwork mentions it.
You do not have to charge it every time. But quoting it in a polite chaser changes the conversation, because the debtor’s finance team knows the Act even when the owner does not.
Whito stage: Any stage. Use it before you sign anything.
The numbers to hold onto
- The statutory rate is 8% above the Bank of England base rate. Late Payment Interest You Can Already Charge.
- Late payments cost the UK economy almost £11 billion a year. UK Late Payment Statistics.
Where to go next
Related: Late payment, Business confidence, The who-you-sue test