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Post Info TOPIC: Interest on overdue invoices
choccly-pops


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Interest on overdue invoices
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Hi All, 

I am hoping someone can help me. I know that you can charge 8.5% interest on overdue invoices. Is that the most you can charge? A friend of mine in business has been charging a client 10% interest per month, and is saying that she's been told she can charge up to 15%. I don't want her to be charging too much and get into trouble. 

Thanks for any advice

 

Carol



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VinceH


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If you are talking about the statutory amount (as specified in the Late Payment of Commercial Debts (1988) then the specified rate is the Bank of England base rate plus 8% - which currently does equate to 8.5% p.a.

However, if your friend specifies in her contract terms a different rate, which the client must have agreed to in order to use her services, then she can charge at that different rate. I'm not sure if there is any limitation on the rate, such as the 15% you mention, but it's possible there is one.

A useful site for advice on this sort of thing is www.payontime.co.uk




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Vince M Hudd - Soft Rock Software

(I only came here looking for fellow apiarists...)
choccly-pops


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Thanks Vince, much appreciated.

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