Late Payment Fee Calculator for Contractors
Work out what an overdue invoice has grown to at your contract rate. The arithmetic is easy. The part that decides whether you collect it is whether the rate was on the invoice before the invoice went late.
Worked example
These are the figures the calculator opens with and the answer it gives. Change anything above and every number below moves with it.
- Unpaid invoice amount8400 $
- Late fee rate you wrote in the contract1.5 % per month
- Days past due45
- Flat fee, if your contract has one0 $
Now owed$8,589.00
| Original invoice | $8,400.00 |
|---|---|
| Days late | 45 (1.5 months) |
| Interest at 1.5% a month | $189.00 |
| Flat fee | $0.00 |
| Total now due | $8,589.00 |
| Annual rate this equals | 18% |
| Per day from here | $4.20 |
What this calculator assumes
- A late fee is only collectable if it was in the contract or on the invoice before the invoice went late. A fee that first appears in a reminder email is not enforceable anywhere.
- 1.5 percent a month is 18 percent a year and is the common trade figure, but states cap this. Several cap it below 18 for consumer work, and a rate over the cap can void the whole fee clause, not just the excess.
- Interest here is simple, charged pro rata by day. Compounding monthly is legal in some states and not others, so the simple figure is the safe one to put on paper.
A late fee you did not write down does not exist
A late fee is a contract term. If it is in the signed contract, or printed on the invoice the customer accepted, it is generally enforceable. If it first appears in an angry email six weeks after the due date, it is not, anywhere in the United States.
Put it in two places: the payment terms clause of the contract, and the footer of every invoice. One line does it. Net 30, then 1.5 percent per month on the unpaid balance.
Rate caps are real and they bite
Eighteen percent a year, written as 1.5 percent a month, is the common trade figure. It is not universally legal. States cap interest on consumer transactions and several cap it well below 18, with different limits for consumer and commercial work.
Exceeding the cap does not just void the excess. In some states it can void the entire interest provision, and in a few it exposes you to penalties. Check your own state's usury statute or ask a local attorney once, and then use that number forever.
What actually gets you paid
Late fees rarely collect themselves. What they do is give you a reason to make contact that is not a complaint, and a cost that grows while the customer thinks about it.
The tools that genuinely move money are earlier: a deposit, progress draws tied to milestones, and a preliminary notice filed on time so your lien rights are alive. By the time you are calculating interest, your leverage is mostly behind you.
Questions people ask
What is a reasonable late fee for a contractor invoice?
One and a half percent a month works out to 18 percent a year, and the calculator prints the annual rate for whatever monthly rate your contract states.
Can I charge a late fee if it is not in the contract?
The fee has to have been in the contract or on the invoice before the invoice went late. Adding it afterwards is not enforceable.
Free Contractor Invoice Template, free, no signup, PDF Word and Excel.
Common sizes, worked out
The same calculator with the numbers already filled in, one page per size, each ending in its own material list.