EU Late Payment Interest Calculator for Invoices: The ECB Rate + 8% Formula, the EUR 40 Fee, and the Invoice Wording

If you're a freelancer billing a business client anywhere in the EU, you already have a legal right to charge interest on late invoices. You don't need a clause in your contract. You don't even need to have mentioned it before.

This is an EU late payment interest calculator for invoices in plain English: the formula, where the numbers come from, two worked examples, and the exact wording to put on your invoice so clients know you'll use it.

The formula (and the one number you need to look up)

The EU Late Payment Directive (2011/7/EU) sets a statutory interest rate for business-to-business invoices. It's the ECB reference rate plus at least 8 percentage points.

The "ECB reference rate" is the European Central Bank's main refinancing rate. The Directive fixes it twice a year: the rate in force on 1 January applies for the first half of the year, and the rate on 1 July applies for the second half. So you don't chase daily rate changes. You look it up once per half-year.

Here's the calculation:

Interest = Invoice amount × (ECB rate + 8%) × Days overdue ÷ 365

Interest is simple, not compound. It starts the day after the due date and stops the day the money lands.

A few things people get wrong:

• It's a floor, not a fixed number. Member states can set a higher margin. Germany uses base rate plus 9 points for B2B. France defaults to ECB plus 10. Most countries (Ireland, Netherlands, Italy, Spain, Austria, Portugal) stick with plus 8.
• Non-euro countries use their own central bank rate. Sweden, Poland, Denmark and others plug in their national reference rate instead of the ECB's.
• It's B2B only. The Directive doesn't cover consumers. If your client is an individual, national consumer rules apply instead.

To find today's ECB rate, search "ECB main refinancing operations rate" or check the ECB's key interest rates page. Then check your national statutory rate, since several countries publish the combined figure directly.

The EUR 40 late payment compensation (per invoice, no reminder needed)

This is the part most freelancers don't know about. On top of interest, the Directive gives you a fixed minimum of EUR 40 in compensation for recovery costs. Per invoice.

You don't have to prove any costs. You don't have to send a reminder first. The day the invoice becomes overdue, the EUR 40 is owed automatically. If your actual recovery costs go beyond that (a lawyer's letter, a collection agency), you can claim those too, as long as they're reasonable.

For small invoices, the EUR 40 is usually bigger than the interest. Which is exactly why it exists: interest alone on a EUR 500 invoice paid two weeks late is pocket change, and the Directive wanted late payment to cost something regardless.

Two worked examples

Let's assume an ECB reference rate of 2.15%, which gives a statutory rate of 10.15%. (Check the current figure before you invoice. If it's moved, swap the number in.)

Example 1: EUR 5,000 invoice, 45 days late

5,000 × 10.15% = 507.50 per year
507.50 × 45 ÷ 365 = 62.57

| Item | Amount |

|---|---|

| Interest (45 days) | EUR 62.57 |

| Fixed compensation | EUR 40.00 |

| Total you can add | EUR 102.57 |

Example 2: EUR 1,200 invoice, 30 days late

1,200 × 10.15% = 121.80 per year
121.80 × 30 ÷ 365 = 10.01

| Item | Amount |

|---|---|

| Interest (30 days) | EUR 10.01 |

| Fixed compensation | EUR 40.00 |

| Total you can add | EUR 50.01 |

Notice how the EUR 40 fee does the heavy lifting on the smaller invoice. That's the pattern for most freelance work: the interest is symbolic, the fee is the real deterrent.

If you'd rather not do the arithmetic by hand, a late fee calculator will run the days and the rate for you. Just plug in the ECB rate plus your country's margin as the annual percentage.

When does the clock actually start?

The Directive's default payment period is 30 days if your contract doesn't say otherwise. The 30 days run from whichever comes latest:

• the date the client received the invoice, or
• the date they received the goods or services, or
• the end of an agreed acceptance period (capped at 30 days).

You and the client can agree longer terms, but anything over 60 days has to be expressly agreed and can't be "grossly unfair" to you. A client who quietly pays on 90-day terms without ever agreeing them in writing is late from day 31.

If you're setting terms for a new client, a net terms calculator helps you see how much cash a 30 versus 60-day term ties up before you agree to it.

Which country's rules apply?

Short answer: usually the law named in your contract. If your contract doesn't say, the default for service contracts under EU rules is normally the law of the country where the service provider is based. So a freelancer in Portugal with no choice-of-law clause is typically working under Portuguese rules, even when billing a client in Berlin.

This matters because of the margin (8, 9, or 10 points) and because a few countries have extra local requirements. If the amounts are large, a quick check with a local accountant or lawyer is worth it. For the average freelance invoice, ECB plus 8 and EUR 40 will get you within a few euros of the right answer in nearly every member state.

One more thing: the EU has been working on replacing the Directive with a tougher Late Payment Regulation since 2023. The proposal included a hard 30-day cap and a higher fixed fee. Check whether it has come into force in your country before you rely on the numbers above for anything contentious.

The invoice wording (copy-paste)

You don't legally need this on your invoice, but stating it does two things. It reminds the client that late payment has a price, and it heads off the "you never told us" conversation.

Put this in your payment terms block:

Payment terms: Net 30 from invoice date. Under Directive 2011/7/EU on combating late payment in commercial transactions, overdue amounts accrue statutory interest at the ECB reference rate plus 8 percentage points, plus fixed compensation of EUR 40 per invoice for recovery costs. Further reasonable recovery costs may be claimed.

If you're in Germany or France, swap in your national margin. If you'd rather keep it softer for long-term clients:

Invoices are due within 30 days. Late payments are subject to statutory interest and the EUR 40 recovery fee provided under EU late payment rules.

And here's the line to use when you actually apply it, on the reminder or the revised invoice:

This invoice is now [X] days overdue. In line with the payment terms and Directive 2011/7/EU, statutory interest of EUR [amount] and fixed compensation of EUR 40 have been added. The revised total is EUR [total].

For a full written policy you can send to clients before you start charging, there's a ready-made late payment policy you can adapt.

Should you actually charge it?

You have the right. Whether you use it is a judgment call. My rule: always state it on the invoice, and always apply the EUR 40 fee once an invoice is more than two weeks late. Waive it as a gesture if the client apologises and pays immediately. Never waive it for a client who's late three months running.

The interest itself matters less on small invoices than the signal. A client who sees a EUR 40 line item on a EUR 900 invoice tends to fix their process. A client who never sees one learns that your due date is a suggestion.

Whatever you decide, the EU late payment interest calculator above works the same way every time: rate plus margin, times the amount, times days over 365, plus EUR 40. Write it into your terms once, and the awkward part of charging it mostly goes away.

Tools like automated payment reminder software can apply the fee and send the revised invoice for you once the due date passes.