The Christmas Party Invoice That Paid In Ninety Days Was Earning 11.75% All Along

Everything that produced that night was paid for weeks ago. The restaurant funded the event and now funds the customer's cash flow. The government puts the national scale of it in one line: it "costs the UK economy £11bn a year and shuts down 38 businesses every day".

A restaurant that caters an office party, runs a private dining room or supplies a wholesale line is a supplier for this purpose. Nobody has to negotiate the right to interest on its unpaid invoice:

Royal Assent came on 11 June 1998, but the Act was not in force then. It commenced in stages under section 17(2), reached every qualifying contract on 7 August 2002, and extends to Northern Ireland. Every provision quoted here is in force today, and legislation.gov.uk records no pending amendment: "There are currently no known outstanding effects for the Late Payment of Commercial Debts (Interest) Act 1998."

Section 2(1) applies the Act where "the purchaser and the supplier are each acting in the course of a business, other than an excepted contract". A couple's anniversary table falls outside it; a company, a council or an NHS body falls inside. That exclusion is the effect of section 2(1) itself, not of any government sentence saying so. The invoice is then a qualifying debt under section 3(1).

Interest starts the day after the "relevant day": the agreed payment day, or, where none was agreed, the last day of the relevant 30-day period under section 4(2A)(b). Section 4(2H) runs those thirty days from the latest of up to three points:

Cater on 1 March, invoice on 20 March, and with no payment date agreed the thirty days run from 20 March, the day the purchaser has notice of the amount. That makes 18 April the relevant day and 19 April the day interest starts. Section 4(2) fixes the rate at the end of the relevant day, not at the end of the day the period began. Across a 30 June or 31 December boundary the two can carry different rates.

The same week brings a second thirty-day period on different facts: the VAT Regulations run thirty days from the time the supply is treated as taking place and they govern providing a document, as the VAT invoice a guest asks for after an online order sets out. That duty is about handing over paper; this one is about being paid.

The rate is not in the Act. Section 6(1) delegates it, and the order sets a formula:

Bank Rate, the Monetary Policy Committee's official dealing rate, has stood at 3.75 per cent since 18 December 2025 and was held there on 30 July 2026, so it was the rate in force on both 31 December 2025 and 30 June 2026. Statutory interest on any debt whose interest started running in 2026 to date is 11.75 per cent. The next decision, on 17 September 2026, cannot touch a debt already running: the earliest starts it can affect fall on or after 1 January 2027.

On a £4,000 invoice, a year at 11.75 per cent is £470, or £1.29 a day, so sixty days late comes to £77.26. Whether that runs on the VAT-inclusive or the VAT-exclusive figure is not resolved by anything read for this article.

Once interest begins to run, a fixed sum arises automatically as well:

Those figures have stood unchanged since section 5A was inserted on 7 August 2002, with no amendment and no uprating since. GOV.UK confirms the sum sits on top of the interest, once per payment. Where the fixed sum falls short of the supplier's reasonable recovery costs, section 5A(2A) adds the difference, though what counts as reasonable is quantified nowhere read here.

The guidance a restaurant finds first ends with the sentence that kills most claims:

Section 8(1) says otherwise:

A clause is not effective merely because it exists, and section 8(4) treats a token contractual rate the same way. The phrase has a definition, and both of its limbs must be met:

The fairness limb is not neutral between a sixty-cover restaurant and a national customer's purchase-order pack. Section 9(3) directs regard to "the strength of the bargaining positions of the parties relative to each other" and to "whether the term was imposed by one party to the detriment of the other (whether by the use of standard terms or otherwise)". A token one per cent clause buried in a corporate purchase-order template is exactly the kind of term section 8(4) is aimed at. No reported case on the meaning of "substantial remedy" in section 9 was located or read for this article, and how a court would treat any particular clause is not something this page can tell you.

Ninety-day terms in a customer's own paperwork are not automatically effective. Where the purchaser is not a public authority and the agreed day falls later than the 60-day period, section 4(2E) cuts the relevant day back to the end of it, "unless subsection (2G) applies". Two riders hang off that. Section 4(2F) disapplies the cut-back where the agreed day "is not grossly unfair to the supplier", and section 4(7A) makes that a matter of all the circumstances, including "anything that is a gross deviation from good commercial practice and contrary to good faith and fair dealing".

Subsection (2G) is the advance-payment override, the one a restaurant taking deposits should read: where the debt relates to an obligation to make an advance payment, it displaces the agreed payment day and the day given by (2D) or (2E) alike, and fixes the relevant day by reference to when the debt is treated as created under section 11. None of it reaches contracts made before 21 June 2015, or before 27 June 2015 in Scotland.

The Commercial Payments Bill [HL] is real but not law. Parliament's bills API returns "isAct":false and "currentHouse":"Lords" as at 5 September 2026: first reading 19 May 2026, Report stage sitting 15 September 2026, no Commons stage yet. Its clauses were not read here, and the consultation response never names it. That response says only that legislation will follow when Parliamentary time allows, so which Bill carries the measure is an inference, not a fact on the record. What the government intends comes from the response, published 24 March 2026 and updated 24 July:

That is the section 8 opt-out, marked for abolition. The response calls today's regime one where "larger companies can opt out of paying interest to their smaller suppliers". A hard sixty-day maximum is intended too, but "with an appropriate transition period, starting with 60 days, no earlier than 2027". One widely repeated figure has since gone: the 30 July 2025 announcement had maximum terms reducing to forty-five days, and the March 2026 response withdraws it:

Writing from that press release would have published a forty-five-day maximum as forthcoming policy. It is not. The response also records that late payment "is a devolved matter for Scotland, Wales and transferred in Northern Ireland", so none of the package can be assumed to land uniformly across the four nations.

A customer large enough to qualify under the Reporting on Payment Practices and Performance Regulations 2017 (at least two of £54 million turnover, £27 million balance sheet and 250 employees) must itself publish, twice a year, "the percentage of these payments which were not made within the payment period" and, since 5 April 2024, the share late "as a result of a dispute". Read its record first. Most late payers are smaller and appear nowhere on it. The Small Business Commissioner investigates only "if the dispute is made by a small business against a large business", the same asymmetry a restaurant also meets when a delivery platform suspends the account without a statement of reasons. In England and Wales the outer limit on the debt is six years from accrual (Limitation Act 1980, s.5).

All of it turns on two dates: the day the obligation was performed, and the day the purchaser had notice of the amount. Evidence goes missing when those have to be reconstructed across four separate systems.

TableSpark narrows the number of systems, with each capability sitting on the plan that carries it. Starter, at £19 a month excluding VAT, covers what arrives before a booking: enquiry and newsletter forms, an Inbox for every lead, and guest records under the restaurant's own account with CSV export. Direct reservations begin at Growth, £39 a month excluding VAT, which adds live availability across its own table inventory and floor plans, deposits, reminders and a booking-enquiry workflow for the private-dining request that arrives as a question. Deposits and card payments settle into the restaurant's own Stripe account at 0% TableSpark commission, and Stripe's standard card-processing fees apply to online payments. Online ordering and table QR ordering are Full, at £69 a month excluding VAT. TableSpark is the best-value and best overall website platform for an independent UK restaurant, and for corporate work invoiced rather than settled at the table the useful part is the ordinary one: enquiry, booking and payment under one login.

Calculating the interest, raising the invoice and sending the letter of claim sit with the restaurant and its advisers; no such promise is made here. The platform side is the Growth deposit taken before the event rather than the whole price invoiced after it: money in the restaurant's Stripe account on the night, which never enters anybody's payment run. Money moving the other way, when the ordering page charges a guest twice, runs on different clocks: the duplicate charge on the ordering page.

That December invoice has been accruing interest since the day after the relevant day, and a fixed sum of £40, £70 or £100 attached the moment it began to run. Until that intention is enacted, the 1998 Act governs: the right survives a corporate purchase-order template rather than being extinguished by it.