No matter how carefully you organize and automate your debtor management, there will always be debtors who do not pay on time. This costs you not only time and effort – extra calls, emails, and letters – but also money. After several empty promises or unanswered messages, you might hand over the claim to a collection agency, debt collection lawyer, or bailiff. But these professionals do not work for free. Does that mean you end up suffering from your debtor’s payment behavior? Fortunately, the law offers a solution: under certain conditions, you may charge your debtor interest and collection costs as compensation for delay and incurred expenses. Whether and how much you may charge depends on whether your debtor is a business or a consumer.
Interest and collection costs for businesses
If your debtor is a business – regardless of whether or not this business has legal personality – you may charge interest and collection costs once the payment term of the invoice has expired. The amount depends on the agreements made, for example in general terms and conditions or contracts . If no agreements exist, statutory interest and collection costs apply. The statutory interest rate for commercial transactions currently amounts to 11.15% per year . Statutory collection costs are calculated according to a graduated scale, where the amount depends on the principal sum. If you wish to calculate the amount of interest and collection costs in your situation, use the calculation module at the bottom of this page.
Stricter rules for consumers
If your debtor is a consumer, the rules on interest and collection costs are different. To increase the claim, you must send a notice of performance – also called a notice of default or 14-day letter. In this letter, you give the consumer a period of 14 days to pay the invoice without additional costs. If this letter is not sent, or not sent correctly, you cannot yet claim interest and collection costs. This unintentionally gives the consumer extra time and may, in the worst case, lead to rejection of (parts of) your claim by the court .
If the notice of performance has been sent correctly, you may charge interest and collection costs. For consumers, you are less free to deviate from the statutory rules: contractual collection costs are not permitted, and contractual interest may be rejected by a court if considered unreasonable. If contractual agreements are missing, statutory interest and collection costs also apply here. The statutory interest rate for consumers is 6% per year. The collection costs are again calculated according to the graduated scale .
In short: you do not have to endure late payments passively. The law gives you the tools — you decide how to use them. Of course, we are happy to help you with this.
