Calculating late-payment interest in Germany: a B2B guide

What are 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.

It is important to delimit the payment of reminder fees. Interest on late payment will run automatically and accurately as soon as the customer is in default, regardless of how many reminders you have sent. Thus, they do not arise because you are send remindersing, but because the payment is not made.

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

In 2026, the level is based on two building blocks: the base rate and a fixed premium. Between companies, the rate is nine percentage points higher than the base rate, which is currently 10.27 percent. If consumers are involved, it is five percentage points, currently 6.27%.

The base rate is published by the Deutsche Bundesbank twice a year, on 1 January and 1 July. It is currently 1.27 percent. The higher rate of 10.27 percent applies to you as a company that invoices another company. This is significantly more than most people expect, and that's why the calculation is worthwhile. The base rate can change as of 1 July, check the valid value directly with the Bundesbank before a settlement. The following graph shows how the rate is composed.

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.

A calculated example of an outstanding claim between two companies shows how quickly this sums up. The basis is a net claim open to 5,000 euros, the current B2B rate of 10.27 percent and 30 days delay.

Example of calculation based on the late-payment interest rate for business transactions, as of 2026. The base interest rate may change as of 1 July, check the valid value before a settlement with the Deutsche Bundesbank.

On a EUR 5,000 claim that is 30 days overdue, this produces more than EUR 82 that you may claim in addition to the principal. Larger amounts and longer delays quickly increase the total. To calculate this for a specific invoice, use the Late-payment interest calculator in a minute.

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.

The practical thing about this is that you do not have to prove the costs in detail. The flat rate is independent of the late-payment interest and applies to each open charge. It is regulated in the Civil Code and only applies to business transactions, not to consumers.

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.
• 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?

You may only charge late-payment interest if the customer is actually in default. This is the case as soon as a specific, calendar-defined payment deadline expires. Furthermore, for business customers, the default occurs automatically no later than 30 days after the due date and access to the invoice, even without a separate reminder.

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 payment reminder, the guide shows Customer does not payWhich 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 unchanged despite payment reminder, a concessional debt collection agency will collect for you, including interest on late payment and flat rate. What this costs is on the page in one sentence. Debt collection costs: The defaulting debtor bears the remuneration, your principal claim remains 100 percent with you. If Austrian customers are also affected, there are slightly different values.

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

Practically, that means three things:

• The first payment reminder you write yourself, with deadline and interest notice.
• Hand over the claim after the second unsuccessful reminder. You can submit it online and Debt collection services, without contract and without minimum volume.
• The page shows how it continues after the handover. How debt collection works.

incaseof.law is an officially licensed collection agency in Austria and Germany. Its model has been confirmed by the Supreme Court, its success rate is 88 percent and you retain 100 percent of the principal.

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.