Late Fee Calculator — how much interest can you charge?
A client is late on an invoice and your contract has a late-fee clause — this tool tells you exactly what has accrued, and gives you the sentence to paste into your collection email. Defaults to the standard safe formulation: 1.5% per month, or the maximum allowed by state law, whichever is lower.
1.5% per month (18% APR) is the common safe formulation.
The calculator uses whichever rate is lower — or the maximum allowed by state law.
A 1.5% monthly late fee applies to overdue balances. As of 2026-10-17, the overdue balance of $1,000.00 has accrued $15.00 in late fees under the contract's late-fee clause (total due: $1,015.00).
Wording follows the same conservative formulation as our guides: a modest monthly rate, or the maximum allowed by state law, whichever is lower. Verify your state's limit before sending.
Why a late-fee clause changes everything
If the contract never says what happens when payment is late, waiting 90 days costs the client nothing. A modest late-charge clause keeps the incentive to pay on time — and turns an overdue invoice from a request into an obligation with a number attached.
Questions freelancers ask
Is an 18% APR late fee enforceable?
State usury limits vary. The standard "safe" formulation is a modest monthly rate or the maximum permitted by applicable state law, whichever is lower — that keeps the clause enforceable across states. The calculator defaults to 1.5% per month (18% APR) and lets you enter your state cap to take the lower of the two.
Can I charge a late fee without a clause in the contract?
Generally much harder. Without a contractual rate you have no agreed number to point to, and you fall back on statutory interest, which is often small. The late-fee clause is the tool — if your current contract has none, add one before the next engagement.
How is a monthly late fee calculated?
As amount × monthly rate × (days overdue ÷ 30). A $1,000 invoice 30 days late at 1.5%/month accrues $15. Days are counted from the due date in the contract, not from the invoice date — unless the contract says otherwise.
What is the safe way to phrase a late-fee clause?
One sentence carries the protection: "Client shall pay the full invoice within 14 calendar days of receipt. A 1.5% monthly late fee applies to overdue balances." Put the same wording in the contract itself — the invoice can restate the terms, but the contract is what binds.
Go deeper
The late fee is only half the fight
The other half is the collection letter. Generate the professional 3-stage demand letter — friendly reminder, formal demand, final notice — in 30 seconds.
Educational content only — not legal advice, and it creates no attorney–client relationship. Late-fee laws vary by state; verify the limit where you and your client do business.