Who the Regulations cover
S.I. No. 580 of 2012 applies to commercial transactions: between businesses, and between businesses and public authorities. Transactions with consumers are excluded (Regulation 3(2)(b)), so none of what follows applies to an invoice sent to a private individual.
The Regulations apply to contracts concluded on or after 16 March 2013. They have since been amended by S.I. 74/2013, S.I. 196/2014 and S.I. 281/2016; this article follows the text as made and the guidance of the Department of Enterprise, Tourism and Employment (DETE).
When payment becomes late: 30 and 60 days
If your contract sets no payment date, the default term is 30 calendar days after your customer receives the invoice. If the date of receipt is uncertain, or if the invoice arrives before the goods or services, the 30 days run from delivery.
- Between businesses, a term longer than 60 days is valid only if it is expressly agreed in the contract and is not grossly unfair to the supplier.
- Public authorities must pay within 30 days, or 60 days where this is justified and expressly agreed.
- Contract terms that are grossly unfair to the supplier can be challenged before the Circuit Court.
Separately, the Government’s prompt payment policy asks public bodies to pay within 15 calendar days of receiving a valid invoice. DETE stresses that this policy does not alter contractual relationships: it is not a legal payment term.
The rate: ECB plus 8 points, fixed each half-year
Regulation 5 sets the rate at the European Central Bank’s rate for its most recent main refinancing operation before 1 January or 1 July, plus 8 percentage points. The rate fixed on that date applies for the following six months.
| Half-year | ECB reference rate | Statutory rate |
|---|---|---|
| 1 January to 30 June 2026 | 2.15% | 10.15% |
| 1 July to 31 December 2026 | 2.40% | 10.40% |
DETE confirms that with effect from 1 July 2026, the late payment interest rate is 10.4% per annum. The ECB had raised its main refinancing rate from 2.15% to 2.40% on 17 June 2026, just before the reference date. The rate for the first half of 2027 will be set from the ECB rate in force before 1 January 2027; check DETE’s page in January.
Worked example
In the examples below, interest is worked out per day over a 365-day year:
Interest = amount owed × 10.40% ÷ 365 × days late
An invoice for €4,200 falls due on 15 September 2026 and is paid on 15 October 2026: 30 days late.
- Yearly interest: €4,200 × 10.40% = €436.80.
- Daily interest: €436.80 ÷ 365 = about €1.20 a day.
- Interest for 30 days: €436.80 × 30 ÷ 365 = €35.90.
- Compensation for a debt from €1,000 to under €10,000: €70.
- Total you can add to the €4,200: €105.90.
| Invoice | Days late | Interest at 10.40% | Compensation | Total extra |
|---|---|---|---|---|
| €850 | 45 | €10.90 | €40 | €50.90 |
| €4,200 | 30 | €35.90 | €70 | €105.90 |
| €12,000 | 60 | €205.15 | €100 | €305.15 |
Fixed compensation: €40, €70 or €100
Regulation 9 gives you a fixed sum for recovery costs without the necessity of a reminder: it is owed as soon as payment is late.
| Amount of the debt | Compensation |
|---|---|
| Under €1,000 | €40 |
| €1,000 to under €10,000 | €70 |
| €10,000 or more | €100 |
If your reasonable recovery costs are higher, for example a solicitor’s or a debt collection agency’s fees, you can claim them on top of the fixed sum.
How to claim it in practice
Statutory interest and compensation are set by the Regulations, but they only come in if you ask for them. A few habits help:
- State a clear due date on every invoice, and mention statutory interest and compensation in your terms of business.
- In your overdue notice, put a figure on both amounts: it turns an abstract cost into a concrete one.
- In a final demand, show principal, interest and compensation on separate lines, with a firm deadline.
- Keep a record of when each invoice was received: the 30-day default term runs from that date.
You can also decide to waive interest, for example for a good customer who agrees a payment plan and keeps to it. If the debt still isn’t paid, our step-by-step guide for when a customer is not paying covers the next stages, up to the courts.
Frequently asked questions
What is the late payment interest rate in Ireland in 2026?
10.15% a year for the first half of 2026 and 10.40% from 1 July 2026: the ECB reference rate (2.15%, then 2.40%) plus 8 points, as published by the Department of Enterprise, Tourism and Employment.
Do I need to send a reminder before claiming the €40, €70 or €100?
No. Regulation 9 makes the compensation due without the necessity of a reminder, as soon as payment is late.
Can I charge late payment interest to a consumer under S.I. 580/2012?
No. The Regulations only cover commercial transactions between businesses, and with public authorities; consumers are excluded.
Can my customer impose 90-day payment terms?
Only if the term is expressly agreed in the contract and is not grossly unfair to you. A grossly unfair term can be challenged before the Circuit Court.
Sources
- Irish Statute Book — European Communities (Late Payment in Commercial Transactions) Regulations 2012 (S.I. No. 580 of 2012) (irishstatutebook.ie)
- Department of Enterprise, Tourism and Employment — Late payment interest rate (enterprise.gov.ie)
- Department of Enterprise, Tourism and Employment — Late Payment in Commercial Transactions (enterprise.gov.ie)
- Department of Enterprise, Tourism and Employment — Prompt Payment Returns (enterprise.gov.ie)
- European Central Bank — Key ECB interest rates (ecb.europa.eu)
This article summarises the official texts to help you get organised. It is not a substitute for personalised advice from your accountant.