How the penalties are calculated
French late payment penalties work like simple interest: the unpaid amount, times the annual rate, times the number of days late, divided by 365. They run from the day after the payment date written on the invoice, for each day late, with no reminder or formal notice. The tool calculates them on the unpaid amount including VAT.
The rate is the one in your terms and conditions of sale, and it can’t be lower than 3 times the French legal interest rate (taux d’intérêt légal). If your terms set none, it is the European Central Bank’s main refinancing rate plus 10 points: the ECB rate in force on January 1 for the first half of the year, and on July 1 for the second (French Commercial Code, article L. 441-10). On July 1, 2026, the ECB rate was 2.40%, so the rate is 12.40% until December 31, 2026. The ECB raised it to 2.65% on September 16, 2026, which doesn’t change the rate of the second half-year.
| Half-year | ECB rate | Default rate (ECB + 10 points) | Lowest contract rate (3 × legal rate) |
|---|---|---|---|
| Second half of 2026 | 2.40% | 12.40% | 8.25% |
| First half of 2026 | 2.15% | 12.15% | 7.86% |
| Second half of 2025 | 2.15% | 12.15% | 8.28% |
| First half of 2025 | 3.15% | 13.15% | 11.13% |
| Second half of 2024 | 4.25% | 14.25% | 14.76% |
| First half of 2024 | 4.50% | 14.50% | 15.21% |
A worked example
An invoice of €1,368.00 including VAT, due on September 15, 2026, is paid on October 15, 2026, 30 days late. At 12.40%, the penalties come to €1,368.00 × 12.40% × 30 ÷ 365 = €13.94. The €40 indemnity is added, for a total of €53.94 to claim. That’s the example the tool shows before you change the values.
When the delay spans two half-years, each day takes the rate of its half-year. An invoice of €1,000.00 due on June 20, 2026 and paid on July 10, 2026 gives 10 days at 12.15% (€3.33), then 10 days at 12.40% (€3.40), so €6.73 in penalties.
The €40 fixed recovery indemnity
Between businesses, a customer who pays late also owes a fixed indemnity of €40 for recovery costs (indemnité forfaitaire pour frais de recouvrement). It applies once per invoice, not per day, and is still owed after a partial payment. It isn’t subject to VAT. If your recovery costs are higher, you can claim more with proof.
With a consumer
The penalties of the French Commercial Code and the €40 indemnity apply between businesses. With a consumer, unless the contract says otherwise, late payment of a sum of money carries interest at the French legal interest rate from the formal notice (mise en demeure; French Civil Code, article 1231-6). When the creditor is a business, that rate is 2.75% a year in the second half of 2026. Pick “A consumer” in the tool and type the date of your formal notice.
After a court decision, if the sum isn’t paid within two months, the legal interest rate goes up by 5 points, according to Service Public, the French government’s information site. The tool doesn’t calculate that case.
The mention for your invoices
An invoice between French businesses shows the payment date, the late payment penalty rate and the €40 fixed indemnity. The tool offers a sentence to copy, in French, with the default legal rate. It reads: “In case of late payment, penalties are due at the European Central Bank rate plus 10 points, as well as a fixed indemnity of €40 for recovery costs (article L. 441-10 of the French Commercial Code).” If your terms set another rate, write that one. The full list is in our article on mandatory information on a French invoice.
Frequently asked questions
How are late payment penalties calculated in France?
Multiply the unpaid amount by the annual penalty rate and by the number of days late, then divide by 365. At 12.40%, an invoice of €1,368.00 paid 30 days late gives €1,368.00 × 12.40% × 30 ÷ 365 = €13.94 in penalties, plus the €40 fixed recovery indemnity.
What is the French late payment rate in 2026?
If your terms and conditions set no rate, it is the ECB rate plus 10 points: 12.15% in the first half of 2026 and 12.40% in the second. A rate set by contract can’t be lower than 3 times the French legal interest rate, 8.25% in the second half of 2026.
Do I need to send a reminder before penalties are owed?
No, between businesses. Penalties run from the day after the payment date written on the invoice, with no reminder or formal notice, according to the French government’s business portal, Entreprendre Service Public.
Is the €40 indemnity subject to VAT?
No. It is owed once per invoice paid late, even after a partial payment, and it isn’t subject to VAT.
Can I charge late payment penalties to a consumer?
The penalties of the French Commercial Code and the €40 indemnity apply between businesses. With a consumer, unless the contract says otherwise, late payment carries interest at the French legal interest rate from the formal notice, 2.75% a year in the second half of 2026 when the creditor is a business.
Sources
Rates and rules checked on October 18, 2026 (sources in French, except the ECB):