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Updated 08/2015

Updated 08/2015

Late payment interest


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Under EU law, whenever business' clients pay their invoices late, you can claim late payment interest.

This applies to all commercial transactions with other businesses (including sole traders, if they issue invoices) and public authorities.

Conditions:

  • you must have fulfilled your contractual and legal obligations
  • the client is responsible for the delay (that is, it is not due to circumstances beyond their control).

You can't claim late payment interest:

  • in transactions with consumers
  • if the invoice is for compensation payments for damages (for example by insurance companies).

In EU countries, late interest payments do not apply if the client is undergoing insolvency proceedings.

When can you claim?

Fixed payment deadline

You can claim interest from the 1st day after the due date.

  • If your customer is a public authority, you have to be paid within 30 calendar days.
  • If your customer is another company, the period for payment fixed in the contract cannot exceed 60 calendar days, unless you expressly agreed otherwise and if it is not grossly unfair to you as the creditor.

Payment period not fixed in the contract

Interest becomes automatically payable 30 calendar days after receipt of the invoice or payment request.

Apart from the interest due, you are automatically entitled to a fixed amount to compensate for recovery costs (minimum EUR 40). You can separately claim compensation for all remaining recovery costs - up to a reasonable amount.

If you don't know when the invoice was received, you can claim interests 30 calendar days after you delivered your service and/or products.

If you send the invoice to your client before you deliver your service and/or product, the countdown starts only after delivery.

How much interest can you claim?

Late interest is the sum of a reference rate and an additional rate. This additional rate must be at least 8% but individual countries may apply higher rates. Public authorities are not allowed to fix lower interest rates.

For B2B claims - if no agreement is reached - the statutory interest for late payment will be applied (minimum 8% plus European Central Bank reference rate or National Central Bank rates for non-Eurozone countries).

Statutory interest rate (%/year)

Member State 1st July 2014 - 31st December 2014
Austria 9.08
Belgium 8.50
Bulgaria 10.00
Croatia 12.29
Cyprus 8.15
Czech Republic 8.05
Denmark 8.20
Estonia 8.15
Finland 8.15
France 8.15
Germany 8.27
Greece 8.15
Hungary 10.10
Ireland 8.15
Italy 8.15
Latvia 8.15
Lithuania 8.40
Luxembourg 8.15
Malta 8.15
Netherlands 8.15
Poland 10.00
Portugal 8.15
Romania 11.50
Slovakia 9.15
Slovenia 8.15
Spain 8.15
Sweden 9.00
United Kingdom 8.50

 

The reference rate in the eurozone is the European Central Bank's main refinancing rate.

In EU countries not using the euro, the reference rate - the interest rate that banks have to pay when they borrow money from their central bank - is set by the national central banks.

In both cases, the published reference rates on 1 January and 1 July are valid for all transactions for the following 6 months. For example, if your unpaid invoice was due on 15 March, the valid reference rate is the one set on 1 January.
 

EU countries can apply conditions more favourable to the creditor.

To help protect SMEs and businesses in their commercial transactions with larger businesses or public authorities, enterprises can now more easily challenge grossly unfair terms and practises before national courts.

Late Payment E-Helpdesk

For more information on the late payment campaign and the implementation and application of the late payment Directive in the 28 Member States. you can contact the E-Helpdesk: GROW-LATE-PAY-E-DESK@ec.europa.eu

The Commission also invites companies and citizens to share information concerning the application of the Directive in their own countries, and to send any evidence of problems experienced when applying the rights conferred by the Directive.

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Help & advice

European Small Claims Procedure

Do you have a commercial dispute with a supplier or client from another EU country? For claims of up to EUR 2 000 use the European Small Claims Procedure to claim your money back - hassle-free.