Invoice late fee calculator
Work out how much to add to an overdue invoice. Enter the amount, the due date and your late fee terms, and see the fee and the new total.
How late fees on invoices work
A late fee compensates you for being paid late. In the US it's usually one of three things, and it should be written on the invoice or in your contract before the work starts.
- Percentage per month: the most common is 1.5% per month, which equals 18% per year
- Annual interest rate: interest charged daily at a yearly rate, such as 10% APR
- Flat fee: a fixed amount, such as $25 or $50, once the invoice is overdue
Monthly late fee = invoice amount × monthly rate × days late ÷ 30
A $2,500 invoice paid 45 days late at 1.5% per month carries a late fee of $56.25, for a total of $2,556.25.
Check your state's limits
Many US states cap the interest or late fee you can charge, and the limit differs from state to state. Some also require the fee to be stated in writing in advance. If you're unsure, check your state's rules or ask an accountant before you add the fee.
Write it on every invoice
A clear line such as “Payment due within 30 days. Overdue balances incur a late fee of 1.5% per month” sets expectations and often gets you paid on time without ever charging it.
More tools
Common questions
What is a normal late fee on an invoice?
1.5% per month (18% a year) is common in the US, as are flat fees of $25 to $50. Check that your rate is within your state's legal limit.
Can I charge a late fee if it wasn't on the invoice?
It's much harder to enforce. Put late fee terms in your contract and on every invoice before payment is due.
Is this calculation simple or compound interest?
Simple. The fee is calculated on the original invoice amount for the number of days late, which is how most small-business late fees work.