The €40 is the bottom rung, not the amount

Everyone who has read the EU directive knows about the €40. Fewer know that Ireland did not stop there.

The ladder

S.I. No. 580/2012 sets the fixed compensation by the size of the debt:

You pick one rung — the amounts do not add up — and you may claim it once per late payment.

So on a €50,000 invoice paid late, you are entitled to €100. Claiming €40 is not wrong in the sense that anything breaks; it is simply less than the law gives you, and nobody will tell you.

And the interest, which is separate

Statutory interest runs at the ECB reference rate plus 8 percentage points, unless your contract sets something else.

We do not print the resulting figure here. The reference rate moves, and a stale percentage on a guide page looks exactly as correct as a current one — so we look it up when the reminder is created instead.

The entitlement is automatic for a valid invoice that is unpaid 30 days after receipt. You do not need to send a warning letter first, and you do not need a clause in the contract.

Why the same directive gives different answers

It is worth knowing that the €40 you read about is a minimum set by Brussels, and every member state implemented it differently. We had to write four of them into our own code before the pattern was clear:

• Ireland — a ladder in euro: €40 / €70 / €100
• The Netherlands — €40 is a floor under a percentage scale. On €5,000 it comes to €625.
• France and Italy — €40 flat. France charges ten points over the ECB rate, not eight.
• Austria — €40 flat, but 9.2 points over the Austrian base rate, not the ECB's.

And Finland, which uses the same eight points as Ireland, lands on a higher number, because Finnish law rounds the reference rate up to the nearest half point before adding them. Same directive, same eight points, different answer on the same day.

If a tool tells you "€40 across Europe", it is undercharging you somewhere.

Sources

• S.I. No. 580/2012, European Communities (Late Payment in Commercial Transactions) Regulations 2012, in force from 16 March 2013. Read 24 September 2026.