Late Fee on a $40,000 Invoice, 30 Days Overdue
Interest at 1.5% a month
$600.00
1.5% a month, simple interest charged pro rata by day, with no flat fee added.
How that number is worked out
These are the figures this page was built with and every line the calculator produces from them. Change anything above and all of it moves.
- Unpaid invoice amount40000 $
- Late fee rate you wrote in the contract1.5 % per month
- Days past due30
- Flat fee, if your contract has one0 $
Now owed$40,600.00
| Original invoice | $40,000.00 |
|---|---|
| Days late | 30 (1 months) |
| Interest at 1.5% a month | $600.00 |
| Flat fee | $0.00 |
| Total now due | $40,600.00 |
| Annual rate this equals | 18% |
| Per day from here | $20.00 |
Days past due compared
Interest is simple and pro rata by day, so it climbs in a straight line rather than accelerating.
| Days past due | Now owed | Total now due |
|---|---|---|
| 30 days | $40,600.00 | $40,600.00 |
| 60 days | $41,200.00 | $41,200.00 |
| 90 days | $41,800.00 | $41,800.00 |
| 120 days | $42,400.00 | $42,400.00 |
What else matters here
Forty thousand dollars at 1.5 percent a month is $600 in 30 days, $40,600 due, $20 a day from there. Four months out the interest alone is $2,400.
At this size the clause that actually changes behavior is usually not the interest, it is the one about legal costs. In most of the United States each side pays its own attorney regardless of who wins, unless a statute or the contract says otherwise. So without a prevailing party clause, recovering $40,000 through a lawyer can leave you meaningfully worse off than the money you were owed.
A clause awarding costs and reasonable attorney fees to the prevailing party changes the arithmetic for both sides, and the side it changes it for most is the one deciding whether to keep stalling. Some state prompt payment statutes supply fees on their own for construction work, which is worth knowing before writing anything off, and a demand letter that cites the actual clause or statute is read very differently from one that does not.
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.
Questions people ask
What is the late fee on a $40,000 invoice at 30 days?
$600 at 1.5 percent a month, so $40,600 is due and it rises $20 a day.
Can I recover attorney fees on an unpaid invoice?
Only if the contract says so or a statute provides it. The usual American rule is that each side pays its own lawyer however the case ends.
What is a prevailing party clause?
A contract term awarding costs and reasonable attorney fees to whoever wins. It is often the single most effective collection clause in a construction contract.
The late fee calculator takes any dimensions you like and hands back the same list.