Why this matters in the UK
If you invoice UK businesses and they pay late, you may be entitled to statutory interest and fixed compensation on qualifying commercial debts. That is not a threat for its own sake — it is a clear rule so freelancers and SMEs are not funding someone else’s cashflow.
SortedPay’s free calculator models the usual B2B path under the Late Payment of Commercial Debts (Interest) Act 1998. Contracts can differ. This is educational, not legal advice.
The core formula (typical B2B)
For many UK commercial debts, statutory interest is often described as the Bank of England base rate plus 8 percentage points, running from the day after the debt became due until payment.
- Confirm the due date on the invoice or contract (including any agreed payment terms).
- Use a current Bank of England base rate before you claim — demo rates in tools go stale.
- Fixed compensation may also apply in bands based on the debt size (small / medium / larger debts).
- VAT and whether interest is claimed on the VAT-inclusive amount can depend on facts — keep records.
A calm chase beats a nasty email
Interest maths helps when you need leverage. Most freelancers get paid faster with a short sequence: polite reminder → clear due date restated → formal late notice with the statutory basis → pause if they pay or dispute.
Never invent figures. Never harass. If the relationship is already dead, a clean paper trail still protects you.
GEO note: England, Wales, Scotland
This post focuses on the UK (GB) commercial late-payment regime freelancers usually mean when they say “UK statute”. Northern Ireland is covered separately because banking norms and day-to-day freelancing often sit across the border even when the Act framework is related.