Free small business calculator
Late Payment Fee Calculator
Calculate late payment fees on overdue invoices. Free late fee calculator with daily interest, monthly percentage, and flat fee options for small business invoicing.
Enter the minimum numbers needed to get a result.
Updated live as you type.
Planning estimate only. It does not include taxes, overhead allocation, depreciation, discounts, or other business-specific adjustments.
A late payment fee is a charge assessed when a customer fails to pay an invoice by its due date, typically calculated as a percentage of the outstanding amount or a flat fee per overdue period.
Formula and example
Percentage: Fee = Invoice × (Rate%/month) × Months. Flat: Fee = Flat Fee × Months
A $1,000 invoice 30 days overdue at 1.5%/month = $15 late fee, total due = $1,015.
Methodology & assumptions
Last updated: 2026-06-13Calculation method
Calculates late fees using either a percentage of the invoice amount per month, a flat fee per overdue period, or a combination. Does not include compounding or legal maximum interest rates which vary by state.
Data sources
Uses the numbers you enter and standard small-business finance formulas. Benchmark comparisons use HustleFin industry benchmark pages where available.
Limitations
Estimate only. Actual late fees should comply with your invoice terms and state usury laws. Many states cap late fees at 5-10% of the invoice amount. Not legal advice.
Input definitions
- Invoice amount: The original invoice amount.
- Late fee type: 0 = percentage, 1 = flat fee.
- Late fee percentage: Monthly or one-time late fee percentage.
- Flat late fee: Flat fee charged for late payment.
- Months overdue: Number of months (or months-equivalent) past due.
Frequently asked questions
What is a typical late payment fee?+
Common practice: 1.5% monthly (18% APR) or a flat $25-$50 fee. The US average is 1.5%/month. Some businesses charge a flat $15-$35 after 30 days. Check your state's maximum legal limit.
Can I charge late fees on overdue invoices?+
Yes, if your invoice or contract specifies late fee terms. Include the fee rate, grace period, and when it applies. Without written terms, collecting late fees is more difficult legally.
Should I use a percentage or flat fee?+
Percentage scales with invoice size — better for large invoices. Flat fees are simpler and easier to enforce — better for small invoices. Many businesses use both: 1.5%/month + $25 minimum.
How do late fees affect customer relationships?+
Late fees can strain relationships. Consider a grace period (5-10 days), send reminders before fees apply, and waive fees for first offenses or good customers. The goal is prompt payment, not penalty revenue.
Next: What to do after this
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