Calculating late-payment interest in Germany: a B2B guide

What is late-payment interest?

Late-payment interest is statutory compensation for receiving an amount after it was due. It is not a penalty: it compensates for the economic disadvantage of being unable to use the money in the meantime.

Late-payment interest and reminder charges are different. Interest runs from the start of legal payment default; sending a reminder does not by itself establish every requirement for default.

What are 2026 late-payment interest rates for businesses and consumers?

Since 1 July 2026, the base rate has been 1.52 percent. Payment claims without consumer involvement carry a nine-percentage-point premium, giving 10.52 percent a year. The statutory rate with consumer involvement is 6.52 percent.

From 1 January to 30 June 2026, the base rate was 1.27 percent, the B2B rate 10.27 percent and the rate with consumer involvement 6.27 percent. The graphic shows the second half of the year. Source: Bundesbank announcement of 30 June 2026.

Calculate late-payment interest step by step

The formula is simple: you multiply the open amount with the late-payment interest rate, then with the number of days overdue, and share the result by the calendar days of the year, i.e. by 365, in the leap year by 366.

Example: EUR 5,000 outstanding principal, 30 days in default entirely within the second half of 2026, and a yearly rate of 10.52 percent. This illustrates the statutory claim before any assignment of interest.

Example for the second half of 2026, rounded to cents. EUR 40 fixed compensation must be credited against recoverable legal recovery costs. Split any period crossing a rate change and apply the relevant rate to each part.

The example yields EUR 43.23 in interest plus EUR 40 fixed compensation where applicable. This does not predict a payout from incaseof.law: the terms provide for assignment of interest on handover. For your own invoice, the late-payment interest calculator uses the German half-year rates, including periods that cross a rate change.

The EUR 40 fixed compensation for business transactions

If you send an invoice to another company and if it is in default, you may demand a flat rate of 40 euros per claim in addition to the late-payment interest. It shall cover the internal expenses caused by the late payment.

Fixed compensation requires a payment claim against a debtor who is not a consumer. It is separate from interest but must be credited against recoverable legal recovery costs. Do not add the same costs twice. Source: German Civil Code: late-payment interest and other loss caused by default.

Special cases that many miscalculate

Three situations lead to mistakes again and again. Whoever knows them calculates clean and enforceable.

• Base rate changes during the delay. If the default runs over 1 January or 1 July and the base rate changes, split the period exactly daily and calculate each section with the then valid rate.
• Partial payments. If the customer pays a part, you will charge the interest only on the remaining outstanding balance from this day onwards. The guide Partial payment on an invoice shows how to recover the balance.
• Late-payment interest is not subject to VAT. There is no VAT on the interest itself.

But the most expensive mistake is not in the formula, but in the calendar: too long waiting. The longer an invoice remains open, the more capital you bind, and the worse the debtor's accessibility and solvency.

When does payment default begin?

Interest requires legal payment default. In Germany, a reminder after the due date may be required, with exceptions such as a valid agreed calendar payment date. The 30-day rule depends on due payment and invoice receipt; consumers need a specific notice. Responsibility for the delay must also be considered. Source: German Civil Code on payment default. What to state on the invoice so that the start of default is clear is explained in the guide Payment terms on the invoice.

An effective first payment reminder with time limit and interest notice can be created with the Payment reminder generator. If the customer does not respond despite a payment reminder, the guide Customer does not pay shows which steps make sense after that.

Safely enforce late-payment interest

Calculating the amount and enforcing it are separate tasks. Support your claim by documenting four things: the original invoice and payment deadline, proof of receipt, the date payment default began and the number of days overdue.

If the outstanding amount and interest remain unpaid despite a payment reminder, a licensed debt collection agency will collect them for you, including late-payment interest and fixed compensation. How to proceed in Germany after an ignored reminder is set out in the guide Final reminder ignored. The Debt collection costs page sums up the cost in one sentence: the defaulting debtor bears the fee, and your principal claim remains 100 percent with you. If Austrian customers are also affected, slightly different values apply there.

Values for Germany according to the Civil Code, as of 2026, for Austria according to the Austrian Commercial Code (UGB) and ABGB. The Austrian values are explained in the guide to late-payment interest in Austria.

Practically, that means three things:

• The first payment reminder you write yourself, with deadline and interest notice.
• If payment is still missing, check the claim submission requirements. Engagement is governed by the terms, with no minimum volume.
• The How debt collection works page shows what happens after the handover.

Actual recovery depends on evidence, objections and ability to pay. Calculating a legal entitlement does not guarantee payment.

This guide explains the legal situation in Germany in general and does not replace advice in individual cases. State of the quoted values and standards: 2026.