Statutory late payment interest rate remains at 13.5% following September 2026 base rate hold
The Bank of England held its base rate at 5.5% on 18 September 2026. The statutory rate for late commercial payments under the Late Payment of Commercial Debts (Interest) Act 1998 therefore remains at 13.5% per year (8% above base).
The Monetary Policy Committee held the Bank Rate at 5.5% at its September 2026 meeting. Under the Late Payment of Commercial Debts (Interest) Act 1998, s.6, the statutory interest rate for overdue commercial payments is fixed at 8 percentage points above the Bank of England base rate. With the base rate at 5.5%, the applicable statutory rate is 13.5% per year.
This rate applies automatically to qualifying commercial debts where the contract does not specify a rate. It runs from the day after the debt becomes overdue. The Bank of England publishes the current base rate. The next MPC decision is scheduled for November 2026.
Businesses owed money on commercial contracts can use LawTheGuide's interest calculator to work out the current amount owed — it applies the statutory formula automatically.
AreaDebt
TypeGuidance
Published28 August 2026
StatusIn force / published
What this means in practice
This guidance affects Debt matters in England & Wales.
It is now published and applies. If this area of law is relevant to your situation, review any contracts, notices or deadlines that may be affected. Use the calculator to check deadlines or interest affected by this change.
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