---
title: "How to tell a customer you are charging a late fee"
description: "Four copy-paste emails for late payment charges: the warning, the charge, a reply to a refusal, the final notice, and the rule that keeps you credible."
url: https://www.paidnice.com/blog/late-fee-email-to-customer
---

# How to tell a customer you are charging a late fee

Written by

Denym Bird
Expert verified

Co-founder & CEO of Paidnice

Denym drafted four copy-paste late fee emails, covering the warning, the charge, a reply to a customer who refuses, and the final notice, plus the rule that keeps you credible.

Reviewed by Jack Daffron

Co-founder of Paidnice

Updated Nov 6, 2026 · 9 min

## Summary

Tell a customer you are charging a late fee with a short email that names the invoice, itemizes the interest and the fixed charge, states the new balance, and gives the date by which paying the original cancels the charge. Send it the day the fee is raised, with a warning email a few days before.

- **Before the charge:** A warning email sent a few days before the due date collects more invoices than the charge itself, and removes the nobody-told-us reply.
- **The charge itself:** Itemize interest, fixed fee, charge total and new balance separately from the original invoice, so the customer can check every figure.
- **If they refuse:** Reply with the clause and the date it was signed, restate the way out, and never argue about how patient you have been.

The four emails below are written for a £3,400 invoice on UK statutory terms. The figures change with your rate.

## What should a late fee email include?

A late fee email includes the invoice reference, the interest to date, the fixed fee, the charge total, the new balance, the daily accrual, and the deadline that cancels the charge if the original is paid. A lump sum reads as a penalty. An itemized charge reads as a process.

Reads as a penalty
Your account is now subject to a late payment charge of £92.98.

One number, no derivation. The customer cannot check it, so their only options are to accept it or argue about it.

Most people argue.

Reads as a process
Interest £22.98 · fixed charge £70.00 · new total £3,492.98 · pay £3,400 by 14 Aug and both are canceled.

Every figure is checkable, and the exit is stated before they have to ask for one.

Most people pay.

## What should a late fee warning email say?

A late fee warning email names the invoice and its due date, states the fixed charge and the daily interest that start the day after, and asks the customer to raise any problem now. The message that collects the most money is the one sent before any charge exists.

1. The warning, a few days before the charge applies

Subject: INV-2418 is due on Friday

Hi [Name],

A quick note that invoice INV-2418 for £3,400 falls due on Tuesday 14 July.

Under our payment terms, invoices that pass their due date attract a fixed recovery charge of £70 straight away, plus late payment interest of about £1.09 a day. It starts from Wednesday.

If the payment is already scheduled, ignore this. If anything is holding it up, tell me today and I will get it sorted.

## How do you itemize a late fee in an invoice email?

Itemize a late fee as its own invoice, with four lines in the email: late payment interest, fixed recovery charge, total charge, and new balance, followed by the daily accrual and the date that cancels the charge. The customer can check every figure against the terms.

2. The charge applied

Subject: Invoice INV-2418, and how to avoid the late payment charge

Hi [Name],

Invoice INV-2418 for £3,400 was due on 14 July and is now 21 days overdue. We have been in touch on 21 July, 28 July and 4 August without a payment or a reason for the delay.

In line with clause 6 of our terms, the following charges now apply and have been raised as invoice INV-2419:

Late payment interest: £22.98 Fixed recovery charge: £70.00 Total charge: £92.98 New balance: £3,492.98

Interest continues to accrue at £1.09 a day until the invoice is settled.

If the original £3,400 reaches us by Friday 14 August, we will cancel the charge in full.

If there is a problem with the invoice itself, tell me what it is today and I will put the charge on hold while we sort it out.

The contact history and the daily accrual figure do most of the work here, and the daily figure matters more than the total because it is what makes waiting feel expensive.

The email that cancels the charge once they pay is in [waiving a late payment fee](https://www.paidnice.com/blog/waiving-late-payment-fees).

![Late fee email for INV-1048 listing interest of 22.98 pounds and a fixed charge of 70 pounds, with a pay button](https://www.paidnice.com/images/blog/late-fee-email-to-customer-card.png)

## What do you say when a customer refuses to pay a late fee?

When a customer refuses to pay a late fee, reply that the charge follows the clause in the terms they signed, with the date, restate the way out, and offer to look at any problem with the invoice itself. Point at the clause, not at their behavior.

Some customers pay the invoice and ignore the charge, which is usually the outcome you wanted. Some write back and refuse.

3. Replying to a refusal

Subject: Re: INV-2419

Hi [Name],

Understood, and thanks for coming back to me.

The charge is not a penalty we have applied at our discretion. It reflects clause 6 of the terms signed on 3 March 2025, and in the UK it also reflects the statutory right to interest and compensation on overdue business invoices.

That said, our preference is always to close this out rather than collect it. If the outstanding £3,400 is with us by Friday, I will cancel the charge in full and we will treat it as done.

If the invoice itself is the issue, tell me which part and I will look at it today.

## What should a final notice email say?

A final notice states the accrued total, the full contact history, a specific date, and what happens after it. It does not threaten, and it is never followed by a second final notice.

4. Final notice before escalation

Subject: INV-2418, final notice before we escalate

Hi [Name],

Invoice INV-2418 for £3,400 is now 35 days overdue, and the accrued charges stand at £108.31. The full balance outstanding is £3,508.31.

We have contacted you on 21 July, 28 July, 4 August, 11 August and 18 August.

Unless the balance is settled or you contact me with a payment proposal by Friday 28 August, this account will be passed for formal recovery. At that point the accrued interest and recovery costs form part of the claim and we will not be able to cancel them.

I would much rather agree something with you this week. If cash flow is the issue, a payment plan is available and I can set it up today.

Two rules for this one. State a date, and mean it, because a final notice that is followed by another final notice teaches the customer that none of them are real. And offer the alternative, because a lot of accounts that reach this stage are cash flow problems rather than refusals, and a [payment plan](https://www.paidnice.com/blog/payment-plan-for-overdue-invoices) collects more than a legal letter does.

What comes after this is a formal [letter before action](https://www.paidnice.com/blog/letter-before-action-template). The full sequence is set out in our [invoice escalation ladder](https://www.paidnice.com/blog/invoice-escalation-ladder).

## Should you charge a late fee on a disputed invoice?

No. A late fee should never be applied to a genuinely disputed invoice. A queried invoice is not late, it is unresolved, and charging it hands the customer a legitimate grievance to raise instead of the payment.

**Pause the account, resolve the query, then resume.** If part of the invoice is agreed and part is disputed, ask for the agreed part now and hold the charge on the rest.

A vague delay is not a dispute. "We are waiting on approval" and "we do not pay until month end" are stalling, and the charge should apply. A specific objection to a specific line is a dispute, and it should be fixed before anything else happens.

## Does the late fee email change by country?

The late fee email changes in one line by country. In the UK and the EU it can cite the statutory right to interest and compensation. Everywhere else it must cite the clause in your signed terms, because the clause is the entire basis of the charge.

**In the UK and the EU** the right is statutory and automatic on business-to-business invoices, so you can reference the legislation as well as your terms. That is a strong position and it is worth stating plainly: the charge exists whether or not the contract mentions it.

**Almost everywhere else**, including Australia, New Zealand, Canada, the United States, South Africa and Singapore, the right is contractual. The email must reference the clause in your terms, because the clause is the entire basis of the charge. "In line with clause 6 of our terms of business, signed 3 March 2025" is doing real work in those markets, not just sounding formal.

Two things to check before sending

In a contractual market, confirm the clause existed before the invoice was raised, and that the rate you are charging is the rate the clause states. If your terms say 1.5% a month, do not send an email charging 2%. Wording is in our [late fee policy wording examples](https://www.paidnice.com/blog/late-fee-policy-wording-examples), and rates by country are in [how much can I charge for late fees](https://www.paidnice.com/blog/how-much-can-i-charge-for-late-fees).

## What mistakes cost you money when you send a late fee email?

Three mistakes weaken a charge that is otherwise due.

- **Quoting a different rate from your clause.** If your terms say 1.5% a month, the charge on £3,400 is £51 (£3,400 × 0.015). At 2% it is £68 (£3,400 × 0.02). The £17 difference may give the customer grounds to dispute the whole charge. *Fix: copy the rate from the clause, not from memory.*
- **Charging a disputed invoice.** The £92.98 charge in email 2 is about 2.7% of the £3,400 invoice (£92.98 ÷ £3,400). The reply you get is about the charge, and the £3,400 stays unpaid. *Fix: pause the charge, settle the query, then resume.*
- **Treating a first late payment as a one-off.** After an on-time payment, a customer pays the next invoice on time about 8 times in 10. After a payment just 1 to 7 days late, that falls to about 3 in 10.*Fix: send the fee email on the first late payment, so the terms are on record before the next invoice.* Source: our analysis of invoice data from over 1,000 Paidnice customers. See [warning signs of a late payer](https://www.paidnice.com/blog/late-paying-customers-warning-signs#one-late-payment).

## How Paidnice does this, and how simple it is

Paidnice sends each of these emails on a schedule as part of the late fee policy, with the figures merged in from the ledger, so nobody has to decide to send one on a specific morning.

![A Paidnice statement interest policy with the customer email notification set to the Statement Interest Charge Issued template](https://www.paidnice.com/images/blog/late-fee-policy-wording-examples-interest.png)

- **The notification is part of the fee policy.** When a charge is applied, the customer is told automatically, with the figures already itemized.
- **The numbers fill themselves in.** Interest to date, the fixed charge, the new balance and the invoice reference are merged into the message, so nothing is typed manually and nothing is wrong.
- **The warning names the exact figure.** A forecast penalty merge tag in a reminder renders "If not paid within N days, a late penalty of $XX.XX will be charged", so the customer sees the real number before the fee exists.
- **Reminders run before the charge as well as after**, so the warning email goes out on schedule rather than when someone remembers.
- **Filter by invoice reference, or move the customer to another group**, which is how a disputed invoice or a disputed account comes out of the sequence without switching the whole policy off.

Related

More reminder wording is in our [email templates for invoice payment reminders](https://www.paidnice.com/blog/email-templates-for-invoice-payment-reminders) and [collection letter templates](https://www.paidnice.com/blog/collection-letter-templates). To work out the figures for a specific invoice, use the [late payment interest calculator](https://www.paidnice.com/late-payment-interest-calculator).

## Common questions

**Do I have to warn a customer before charging a late fee?** Legally, usually not, and in the UK the statutory right applies without notice. Practically, always. The warning collects more invoices than the charge does, and it removes the "nobody told us" reply.

**What if they say they never agreed to late fees?** In the UK and EU, point to the statutory right, which applies regardless of the contract. Elsewhere, point to the clause and the date they accepted it. If there is no clause, you have a terms problem rather than an email problem.

**Should the fee email come from a person or an accounts address?** A person, with a real reply address. An accounts inbox invites being ignored, and the whole point of the message is that someone is watching this account.

**How long should I give them to avoid the charge?** Seven to ten calendar days. Long enough to clear an approval process, short enough to fall inside one payment run.

**Can I charge a fee and still keep the relationship?** Yes, and consistency is what makes that possible. A charge that applies to everyone every time is a policy. A charge that appears only when someone is annoyed is personal, and that is what damages relationships.

**How do I politely ask for an overdue payment?** Name the invoice, the amount and the due date, ask whether anything is holding it up, and state what happens next and when. The specifics and the offer to help are the politeness. Reminder wording is in our [payment reminder templates](https://www.paidnice.com/blog/email-templates-for-invoice-payment-reminders).

**How many days after a payment is due is it considered late?** One. An invoice is late the day after its due date, and in the UK statutory interest runs from that day. A grace period of 7 to 14 days before the fee applies is common, but the reminder should not wait for it.

## Paidnice features in this article

- [**Late fees and interest** Adds late fees and interest to overdue invoices when you turn them on.](https://www.paidnice.com/late-fees)
- [**Prompt payment discounts** Offers an early payment discount that removes itself after the date.](https://www.paidnice.com/prompt-payment-discounts)
- [**Email and SMS reminders** Sends reminders by email and SMS on your schedule, each with a link to pay.](https://www.paidnice.com/email-sms-reminders)

## About the editorial team

Written by Denym Bird Co-founder & CEO of Paidnice

Denym started Paidnice in 2022 after customers paying late left his own business short on payroll. He has led it to $1 billion collected on time across more than 1 million invoices, and writes about credit control, late fees and getting paid on Xero and QuickBooks.

Reviewed by Jack Daffron Co-founder of Paidnice

Jack is a co-founder of Paidnice and has built accounting software for more than 10 years. He builds the product that sends reminders, adds late fees and takes payments for businesses on Xero, QuickBooks and ERPs such as NetSuite and Business Central.

### Try Our Free Accounts Receivable Calculators

Optimize your cash flow with our suite of financial tools designed for AR professionals. Calculate DSO, aging analysis, late fees, and more.

Explore Calculators

## Start getting paid on time with Paidnice

Connect Xero or QuickBooks and Paidnice prepares draft policies for you. Nothing runs until you approve them.

Try it FreeBook a Demo

[Rated 5 stars, 160+ reviews](https://www.paidnice.com/reviews) · [App of the Year](https://www.paidnice.com/blog/winner-xero-global-app-awards-2026)