Flat Invoice

Q&A

What are typical late fee rates on invoices?

1% to 2% a month is the typical range, which equals 12% to 24% per year. Many US states cap interest on commercial debts, so you should check your state's limits before going above 1.5%.

When should late fees be disclosed to clients?

You can only charge a late fee that was on the invoice or contract before work started. Adding a fee after the fact does not hold up legally. Put the rate on every invoice as a line stating something like 1.5% per month on balances past due.

What happens if you waive a late fee once?

Charge the late fee the first time it is owed. A fee you waive once is a fee the client knows is fake, even if it is just $20 on the first late invoice, and this sets the pattern for every invoice after.

How does the late fee calculator compute interest?

The calculator uses simple interest, pro-rated by day on a 30-day month, which is the most common method and the easiest to defend.