Definition
A graphic designer sends her €3,000 invoice on 5 March, payable within thirty days. By 12 April nothing has arrived. She follows up, almost apologising, then waits three more weeks.
What she does not know is that since 5 April her client has owed her more than €3,000: the delay earns interest, every single day, without her having to do anything at all.
Late payment penalties are the amount a business customer automatically owes from the day after the settlement date shown on the Invoice.
The French commercial code makes them payable as of right, with no reminder, no formal notice and no proof of loss.
Their rate is one of the details every business-to-business invoice must carry: leaving it out is a punishable omission, while writing it costs nothing.
The rate: the one you set, or the one the law sets
There are two situations, and only two. Either you have set a rate in your Terms and conditions and you restate it on every invoice, in which case that rate applies.
Or nothing is written down, and the default rate laid out in the French commercial code takes over: the European Central Bank refinancing rate in force at the start of the half-year, increased by the number of points the law sets.
That rate changes twice a year, on 1 January and 1 July, and should be read from the official source rather than from an invoice template copied year after year.
Your freedom is not unlimited: the rate cannot fall below a statutory floor, expressed as a multiple of the legal interest rate, and a clause that goes under it is punishable.
The calculation itself fits in one line: the invoice amount including tax, multiplied by the annual rate, then prorated over the days of delay.
Under the VAT basic exemption your amount including tax is your amount excluding tax, which spares you half the work.
One line on the invoice is enough, provided it is complete: "In the event of late payment, a penalty at an annual rate of ... % is due from the day after the settlement date, with no prior reminder, together with the fixed recovery fee."
Two mistakes keep showing up in the free templates going around: a monthly rate presented as an annual one, which multiplies the debt twelvefold, and the phrase "from the date of a formal notice", which strips you of the automatic right the law gives you.
€3,000 unpaid: what the delay really costs
Back to the designer's invoice, under the non-regulated liberal professions (BNC, non-commercial professional income).
The client pays on 20 May, a month and a half past a due date that fell in early April.
The penalty then comes down to one operation: the €3,000 multiplied by the annual rate in your terms, then reduced to the share of the year that delay represents.
What remains is the worry that bites hardest, the contributions.
| Stage | What you declare | What you pay |
|---|---|---|
| Invoice issued on 5 March, unpaid | €0 | €0 of contributions |
| Transfer received on 20 May | €3,000 | €768 at the 25.6% BNC rate in 2026 |
| Vocational training contribution (CFP) | €3,000 | €6 at the 0.2% rate in 2026 |
The micro scheme only knows money actually received: an unpaid invoice costs you nothing in contributions, since nothing enters your return as long as nothing has been collected.
The €768 of social contributions at the 2026 rate for non-regulated liberal professions and the €6 of vocational training contribution only fall due on the day of the transfer, and that headline rate covers neither that contribution nor income tax.
Two caveats on those two lines. The training contribution is only due if positive revenue was declared during the previous calendar year.
And a regulated liberal profession affiliated to the Cipav would pay on the same €3,000 at the 23.2% rate in 2026, which did not follow the general scheme's increase.
A delay that pushes the payment past 31 December even moves the €3,000 into the following calendar year.
The reporting calendar follows the same principle.
The March invoice appears nowhere in the first-quarter return: it belongs to the second quarter, the one the transfer arrived in, or to the May return if you declare monthly.
Nothing needs correcting afterwards, and a late payment never triggers an amended return.
The costliest reflex is issuing a Credit note to cancel an invoice the client is not paying.
It comes from the standard regime, where an invoice is taxable as soon as it is issued and where a credit note is how a lost debt is written off.
Under the micro scheme that manoeuvre brings no tax benefit and wrecks your case: you declare collections only, so the unpaid invoice makes you pay nothing, whereas the credit note extinguishes the debt, and with it the penalties and the recovery fee.
An unpaid invoice is chased, put on formal notice and recovered. It is not cancelled.
Penalties, fee, private customers: three lines to keep apart
Penalties are not the only sum owed. On top comes the Recovery fee, whose amount is set by decree, owed for each late invoice and payable by business customers only.
The two add up rather than replace each other: one grows with the days, the other is owed once.
The distinction that really changes things lies elsewhere: the automatic rule in the commercial code applies between businesses only. With a private customer, no penalty runs on its own.
You need a clause accepted before the order, and failing that only interest at the legal rate runs, from the formal notice onwards.
Do not confuse the penalty with the early settlement discount either, its neighbour on the invoice: one punishes lateness, the other rewards speed, and both are counted from the same due date, the one set by the agreed Payment terms.
Frequently asked questions
Do you need to issue a new invoice to claim the penalties?
No, they are owed without any step on your part.
In practice, a written reminder stating the number of days of delay, the rate applied and the resulting amount beats a vague nudge: it puts a figure on the debt, it dates your claim and it becomes evidence if the matter goes further.
Can you waive the penalties to keep a good client happy?
Whether you claim them is your commercial call, and plenty of micro-entrepreneurs let a first delay go.
What is not negotiable is having the wording on the invoice and respecting the statutory floor: a clause removing the penalties or setting too low a rate exposes you to a sanction.
The client has gone silent, what comes after the reminders?
Move on to the Formal notice, sent by registered post: it marks the turning point and starts interest running against a private customer.
With no answer, the Payment order lets you obtain an enforceable title from the court, without a lawyer and at modest cost.
Does an unpaid invoice count towards my turnover ceiling?
No. The micro scheme ceiling is assessed on the revenue excluding tax actually collected during the calendar year, never on what was invoiced.
A December invoice paid in January therefore counts towards the following year, which also pushes back the date your thresholds are crossed.
A single overrun pushes nobody out either: the scheme only ends if the ceiling was exceeded in two consecutive calendar years.
Should the rate also appear on the quotation?
Nothing requires it on the quotation itself, but a signed quotation referring to terms handed over at the same time makes the clause enforceable from the order onwards.
That is the best protection with a private customer, for whom the penalty only exists if it was accepted beforehand.
The rate, the number of days late and the amount are quick to get wrong. Formal demand for an unpaid invoice does the sum for you and writes the letter that goes with it.