Late Payment Interest for Freelancers: The Complete Guide
Your client is 30 days late. Can you charge them extra? The short answer is: **Yes, but you need to do it right.**
The Rule: Put it in the contract
You cannot legally enforce a late fee if the client never agreed to it. The best place to do this is in your initial contract or on the invoice itself **before** they accept the work.
Standard Late Fee Clause:
"Invoices not paid within 30 days of the invoice date are subject to a 1.5% monthly late fee."How to calculate interest
Most freelancers charge between **1.5% and 2% per month**. This equates to about 18-24% per year (APR).
**Formula:**
**Example:**
Invoice: $1,000
Late Fee (1.5%): $15
Total Due: $1,015
Should you actually charge it?
This is the tricky part. Charging a $15 late fee might annoy a client enough that they stop working with you.
**Strategy:** Use the late fee as leverage, not revenue.
When a client is late, say:
*"Technically, there is a late fee on this invoice as per our contract. However, if you can pay by Friday, I'm happy to waive the fee."*
This makes you look generous while still applying pressure.
Automate the reminder, prevent the fee
The goal isn't to collect late fees; it's to get paid on time.
**Followio** ensures your clients receive polite, automated reminders before the due date, so you rarely have to have the "late fee conversation".