The effective annual rate shows the true annualized cost of the delay, useful when deciding payment terms or late fees for future invoices.
Aging Summary
Invoice #
Amount
Days Late
Late Fee
Total Due
INV-001
4,93
1.004,93
INV-002
24,66
2.524,66
INV-003
11,10
761,10
Total
4.250,00
40,68
4.290,68
Late Fee and Total Due per invoice are calculated with the current Annual Interest Rate and Flat Late Fee above.
Payment Reminder
Overview
The Invoice Late Payment Calculator computes interest and fees on overdue invoices, the total amount owed, and the effective annual cost of a delay. It supports multiple overdue invoices in an aging table, simple or compound interest, and generates a professional payment reminder letter you can send to clients. It helps freelancers, consultants, and small businesses set payment terms, charge consistent late fees, chase overdue accounts systematically, and quantify what late-paying clients really cost.
Common Use Cases
Late fee calculation
Payment terms planning
Accounts receivable review
Client payment follow-up
Interest calculation on overdue invoices
Net-30 and Net-60 term analysis
Freelance invoicing
Collection process improvement
Cash flow planning
B2B invoice management
Contract term negotiation
Aging receivables analysis
How to Use
1
Enter the original invoice amount.
2
Input how many days the payment is late.
3
Set the annual interest rate to apply.
4
Optionally add a flat late fee.
5
Review the interest charged, total late fee, and total amount due.
6
Check the effective annual rate for context on your payment terms.
7
Add multiple overdue invoices to the aging table to see interest and totals per invoice plus a combined amount due.
8
Toggle compound interest if your terms charge interest on previously accrued interest rather than simple interest on the original amount.
9
Generate a payment reminder letter with the calculated amounts to send as part of your collection follow-up.
Example Scenario
Overdue Client Invoice
A freelancer has a client invoice that is 30 days overdue. The calculator determines the interest and fee to add and shows what the delay is worth in annualized terms.
Technical Notes
Interest is calculated as the invoice amount times the annual rate times the fraction of the year the payment is late.
A flat fee can be added to cover administrative costs of chasing overdue payments.
Total late fee combines the accrued interest and any flat fee.
Total due is the original invoice plus the total late fee.
The effective annual rate annualizes the total fee, showing the true cost of the delay.
The multi-invoice aging table calculates interest and fees for each invoice separately based on its own amount and days overdue, then groups invoices into aging buckets such as current, 1-30 days, 31-60 days, and over 60 days past due.
With compound interest enabled, interest accrues on previously accumulated interest using a monthly compounding period. Simple interest is calculated only on the original invoice amount.
The payment reminder letter template pulls in your calculated figures, including interest and total due, so you can copy or send a professional, factually accurate collection notice.
Common Mistakes
Not stating late fees in terms up front
Using monthly rates as if they were annual
Forgetting to include a flat administrative fee
Charging interest on top of compounded fees
Ignoring grace days in the contract
Never following up on overdue invoices
Frequently Asked Questions
Use a rate stated in your payment terms, commonly 1-2% per month (12-24% annually), or the statutory rate allowed in your jurisdiction.
After the invoice due date plus any grace period defined in your terms, typically Net-30 or Net-60 from the invoice date.
Yes. It shows the annualized cost of the delay and helps you decide whether your late-fee policy is strong enough to deter slow payers.
Yes, many businesses charge interest plus a flat administrative fee, as long as the terms are disclosed in advance.
Use whatever your payment terms state. Simple interest is more common and easier for clients to verify, while compound interest increases pressure on long-overdue accounts. Only charge compound interest if it was agreed in advance.
It shows interest and totals per invoice and groups receivables into aging buckets, so you can prioritize collection on the oldest, largest debts and see your total exposure at a glance.